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Telephone  Memoranda 


UC-NRLF 


A  Few  Facts  and  Opinions 
Foreign  and  Domestic 


In  response  to  an  inquiry,  Theodore  N.  Vail,  President  of  the  American 
Telephone  &  Telegraph  Company,  made  this  statement  December  19,  1913: 

Our  telephone  system  has  been  the  study  of  investigators  from  many 
countries.  It  has  been  considered  the  world's  model,  not  because  it  is 
the  largest,  but  because  it  gives  the  best  service  and  is  more  useful  to 
the  public  than  any  other  system. 

Such  succeaa  as  we  have  achieved  has  come  from  our  study  of  facts 
and  our  willingness  to  be  guided  by  them.  We  have  not  endeavored  to 
sell  our  telephone  system  to  the  government  for  the  reason  that  the  facts 
as  we  have  gleaned  them  during  the  last  thirty  years  from  all  parts  of  the 
world,  have  not  justified  such  a  course. 

Our  people  are  personally  familiar  with  every  telephone  system  that 
today  exists.  The  telephone  experience  of  Japan  or  France,  is  as  closely 
studied  as  the  experience  of  one  of  our  American  cities. 

We  have  freely  given  our  aid  to  make  the  government  systems  in 
foreign  lands  as  good  as  possible,  believing  that  every  advance  in  the  art 
helped  us  to  advance.  We  have  never  found  any  foreign  subscribers  as 
well  serrwl  as  our  subscribers,  nor  any  foreign  public  receiving  greater 
advantages  from  the  telephone  than  the  American  public. 

We  recognixe  our  responsibility  to  the  telephone-using  public,  which 
is  practically  the  whole  public,  and  for  that  reason  favor  an  intelligent, 
painstaking,  thorough,  scientific  study  of  the  proposals  for  public  owner- 
ship. We  cannot  be  content  if  facts  which  we  know  to  exist  are  carelessly 
ignored.  But  if  all  the  facts  are  discovered,  understood  and  exploited,  we 
are  bound  to  be  content  with  a  decision  based  on  those  facts. 


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AMERICAN  TELEPHONE  AND  TELEGRAPH  COMPANY 

Information    Department 

NEW  YORK 


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OUTLINE 
Public  Sentiment 

Pages 

Foreign  9 

American 9-1 1 

Public  sentiment  in  Great  Britain,  the  product  of  costly  experience,  is  now  practically 
unanimous  in  condemning  its  Government  telephone  service ;  enlightened  public  senti- 
ment in  the  United  States,  as  reflected  in  the  press,  shows  that  Americans  intend  to 
profit  by  the  experience  of  other  countries,  and  that  the  proposal  to  substitute  political 
management  of  our  telephones  and  tel^[raphs,  for  the  highly  efficient  management  of 
private  enterprise,  will  not  be  tolerated  by  our  democratic  spirit  of  initiative  and  self- 
reliance. 

Economic  Aspect 11-15 

The  science  of  political  economy  is  well  epitomized,  as  to  government  ownership,  in 
the  words  of  Thomas  Jefferson :  "Having  always  observed  that  public  works  are 
much  less  advantageously  managed  than  the  same  are  by  private  hands,  I  have 
thought  it  better  for  the  public  to  go  to  market  for  whatever  it  wants  which  is  to  be 
found  there."  Economists,  from  Adam  Smith  down,  emphasize  Government's  "incom- 
petency as  a  business  agent,"  and  warn  us  that  it  is  fatal  "to  multiply  the  activities  of 
government  so  as  to  bring  about  vexatious  interference  with  liberty  or  to  restrict  legiti- 
mate enterprise."  Although  one  economist.  Prof.  H.  C.  Adams,  objected,  in  1887,  that  ' 
monopolies,  under  "private  financiering,"  tend  to  maintain  prices  at  the  h^hest  profit- 
able point,  his  objection  has  since  been  overcome  by  the  institution  of  public  regula- 
tion (see  "R^ulation  vs.  Ownership").  According  to  Prof.  Adams,  only  industries  of 
"Increasing  Returns"  tend  naturally  to  monopoly,  and  Adams  doubted  that  the  tele- 
phone is  such  an  industry,  as  did  other  economists. 

Foreign  Experience  No  Precedent 15-23 

It  is  unsound  to  argue  that  Americans  should  adopt  Government  Ownership  merely 
because  many  Europeans  have  adopted  it.  Conditions  differ.  An  easy-going.  Govern- 
ment-ridden European  will  tolerate  much  that  the  impatient,  exacting  "we-want-what- 
we-want-when-we-want-it"  American  would  not  tolerate  a  minute.  The  American's 
ideal  of  service  is  diflFercnt :  quality  first,  with  as  reasonable  a  price  as  possible,  rather 
than  cheapness  first,  with  what  service  cheapness  will  buy.  Political  systems  differ ;  long 
tenure  of  office  in  Europe  permits  greater  efficiency  and  continuity  of  management; 
public  officials  in  America  are  turned  out  of  office  just  as  they  begin  to  "learn  the 
ropes."  Despite  such  advantages  as  Eurojjean  governments  may  possess,  their  expe- 
rience with  Government  Ownership  of  telephones  and  telegraphs  has  not  been  such  as. 
to  recommend  it  to  this  country. 

Arbitrary  and  Irresponsible  Administration 

Foreign  (Official) 23-24 

(Editorial) 25-26 

American  ( Official)  27 

"        (Editorial) 27-28 

"From  Government  there  can  be  no  appeal."  Private  companies  are  subject  to  com- 
plaints, Init  governments  are  subject  only  to  petitions.     Under  Government  Owner- 

3 

347251 


Pages 
ship  the  public  finds  itself  practically  powerless  to  obtain  relief  from  abuses.  (See 
"Regulation  vs.  Ownership.")  Government  employees,  protected  by  a  rigid  civil 
service,  possess  little  eagerness  to  please  the  public.  The  heads  of  private  companies 
must  account  strictly  to  the  stockholders  and  the  public  for  the  funds  invested  in  the 
enterprise,  but  governments  are  notoriously  irresponsible  in  accounting  for  public 
funds,  so  that  taxpayers — unlike  stockholders  of  a  corporation — have  no  exact  means 
of  finding  out  what  is  done  with  their  money.  Private  concerns  are  strictly  liable  for 
damages  to  persons  and  property ;  public  bodies  limit  liability,  or  evade  it  altogether. 

Comparative  Efficiency 

Official 29-30 

Editorial 30-34 

Government  management  is  never  so  efficient  as  private.  It  is  handicapped  by  inertia, 
red  tape,  and  uncertain  tenure  of  office  among  the  executives.  Private  employees  work 
less  by  the  clock  than  holders  of  government  jobs.  Their  initiative  is  not  circum- 
scribed by  definite  limitations.  Their  inefficiency  is  not  coddled  by  political  influences. 
Results,  in  the  field  of  telephones  and  telegraphs,  amply  bear  out  the  superior  efficiency 
of  private  management,  both  as  to  economic  operation,  and  the  extent  and  quality  of 
service. 

Service 

Foreign  {Official) " 35-38 

{Editorial) 38-42 

In  point  of  service,  there  is  no  comparison  between  the  government  managed  telephone 
of  foreign  countries,  and  the  privately  operated  telephone  in  the  United  States.  Only 
Americans  who  have  traveled  abroad  fully  appreciate  why  foreigners  envy  us  our 
privately  operated  telephone  service.  The  delays,  mismanagement  and  general  inade- 
quacy of  Government  telephones  in  Europe  are  illustrated  by  numerous  instances. 
Government  telegraphs  are  equally  uninviting.  The  only  telegraph  service  abroad  com- 
parable with  our  own  is  that  known  as  "preferred"  or  "urgent",  for  which  double  and 
triple  rates  are  charged.  The  bulk  of  European  telegrams  are  "ordinary",  and  {e.  g.  on 
the  Continent)   must  wait  their  turn — often  for  hours — before  despatched. 

Rates 

Foreign  {Official) ; 42-45 

{Editorial) 45-48 

American  {Editorial) '.  .;.\ 48 

•  The  familiar  cry  of  "cheap  rat|^under  Government  Ownership  is  misleading.    Gov- 

ernment Ownership  is  no  panaflKor  rates :  foreign  Government  telephone  systems  are 
constantly  harassed  by  rate  dissatisfaction,  which  is  aggravated  by  political  pressure. 
The  doctrine  "Political  might  makes  right",  renders  impossible  a  fair  and  equitable 
adjustment  of  rates  under  Government  Ownership.  •<jovernments  do  not  operate  as 
cheaply  as  private  companies,  and  can  not  give  cheaper  rates  without  cheapening  the 
product  (service),  or  producing  a  deficit.  Deficits  must  be  met  by  taxation,  which 
means  a  borrowing  from  Peter  (the  taxpaying  non-user,  who  is  apt  to  be  poor,  being  a 
non-user),  for  the  benefit  of  Paul  (the  subsidized  user,  who  is  generally  in  better  cir- 
cumstances than  the  non-user).  While,  in  some  cases,  foreign  telephone  rates  are 
cheaper  than  in  the  United  States,  it  can  be  conclusively  demonstrated  that  the  average 
charge  for  telephone  service  abroad  is  greater  than  in  this  country,  when  the  same 
units  of  measurement  are  used,  notwithstanding  that  in  the  United  States,  service — in 
quality  and  extent — is  immeasurably  superior,  purchasing  power  of  money  less,  and 
employees'  pay  about  twice  as  high.  Telegraph  rates,  where  length  of  haul  and  speed 
of  service  are  comparable,  are  less  in  the  United  States  than  abroad  (See  "Service"). 

4 


Expense 

Pages 

Foreign  (Official) 49-51 

(Editorial) 51-52 

American  ( Official)  52-53 

(Editorial)   53-54 

To  purchase  the  telephone  and  telegraph  systems  in  the  United  States,  the  Govern- 
ment would  have  to  double  its  national  debt.  It  would  then  acquire,  not  a  financial 
asset,  but  a  liability,  unless  it  raised  rates  or  lowered  service  (See  "Comparative  Effi- 
ciency"). None  of  the  foreign  systems  are  known  to  produce  a  profit.  Many  produce 
heavy  deficits.  The  Post  Office  is  comparatively  simple  and  inexpensive  to  operate,  yet 
annual  deficits  force  it  to  the  public  purse  for  support.  The  infinitely  more  complex 
and  intricate  management  of  telephones  and  telegraphs  would  impose  a  far  greater 
drain  upon  the  public  exchequer,  which  would  invariably  find  its  way  to  the  taxpayer's 
pocket  (See  "Rates"  and  "Taxation"). 

Mismanagement 

Foreign  (Official) 54-56 

(Editorial) 56-58 

From  the  fact  that  what  is  everybody's  business  is  generally  nobody's,  that  governmental 
machinery'  is  designed  for  governing  rather  than  for  commercial  administration,  that 
"the  state  has  to  submit  to  too  many  influences  other  than  the  needs  of  the  public,"  that 
continuous  service  of  officials  and  thorough  familiarity  with  their  work — the  essentials 
of  efficient  management — ^are  impossible  under  political  administration,  mismanagement 
of  Government  telephone  and  telegraph  systems  has  followed  inevitably,  as  instances 
from  foreign  experience  strikingly  illustrate. 

Stagnation  vs.  Expansion 

Foreign  (Official) 58-60 

(Editorial) 60-62 

American  (Editorial) 62-63 

The  contention  that  Government  Ownership  makes  for  "social  utility"  by  serving  profit- 
able and  unprofitable  communities  alike,  is  not  supported  by  the  facts.  The  United 
States,  with  5.5%  of  the  world's  population,  has  65%  of  the  world's  telephones. 
Europe,  with  its  Government-owned  systenl?^  has  four  times  the  population  of  the 
United  States,  but  much  less  than  half  the  number  of  telephones.  The  British  Post- 
'  master  General  refuses  to  extend  tel^^raph  service  to  pomts  where  it  will  not  pay. 

European  Government  Telephone  Departments  have  exploited  the  larger  and  more 
profitable  communities,  and  comparatively  ignored  the  smaller  and  unprofitable  ones 
(See  page  60).  The  true  situation  is,  private  telephone  and  telegraph  systems  serve  a 
country  far  more  universally  than  Government  systems,  because  lack  of  commercial  in- 
centive under  Government  operation  breeds  stagnation,  whereas  the  watchword  of  pri- 
vate enterprise  is  expansion.  "Creative  epochs  in  industry  are  the  work  of  individuals, 
not  of  Governments." 

Financial  Constriction 

Foreign  (Official) 63-64 

(Editorial) 64-65 

American  (Editorial) 65 

The  high  standard  of  American  telephone  service  is  largely  the  result  of  proper  financ- 
ing.    Plans  laid  ten  and  twenty  years  in  advance  have  been  rigorously  backed  up  by 

5 


Pages 
the  necessary  investment.  The  money  spent  has  at  all  times  equalled  the  money  needed 
to  maintain  the  best  service  possible.  Government  systems,  on  the  contrary,  have  suf- 
fered from  financial  starvation.  Governments  are  incapable  of  consistent  financing. 
Plans  are  no  sooner  completed,  than  they  are  swept  away  by  new  administrations  with 
new  plans.  Appropriation  bills  are  framed  less  with  an  eye  to  what  is  required,  than  to 
what  can  be  obtained.  The  appropriations  voted  are  governed  less  by  the  commercial 
needs  of  the  service,  than  by  the  political  needs  of  the  moment. 

Taxation 

Foreign  (Editorial) 65 

American  (Editorial) 66-67 

Government  cannot  create  something  from  nothing.  Its  bills  must  be  paid  by  the  tax- 
payer. Any  increase  in  government  expense  increases  the  taxpayer's  burden,  and  adds 
that  much  to  the  "high  cost  of  living."  Should  the  Government  spend  a  billion  dollars 
on  telephones  and  telegraphs,  the  taxpayer  would  have  to  foot  the  bill.  Unless  it  in- 
creased telephone  and  telegraph  rates,  the  Government  would  have  to  run  at  a  loss 
(See  "Comparative  Efficiency"),  which  would  mean  an  annual  expense  item  to  the 
taxpayer,  for  the  benefit  of  a  new  army  of  Government  job-holders.  (See  "Ex- 
pense.") A  lowering  in  rates  would  be  but  a  new  form  of  class  legislation :  The  very 
poor  could  economize  on  telephones  and  telegraphs,  but  not  on  telephone  and  telegraph 
taxes.  (See  "Rates.")  The  public  debt  has  been  increasing  by  leaps  and  bounds :  why 
magnify  the  burden? 

Employees 

Foreign  ( Official) 67-68 

(Editorial) 69-73 

American  (Official)  73-75 

(Editorial) 75-76 

Government  employment  appeals  mainly  to  those  who  are  willing  "to  mortgage  one's 
better  prospects  and  potentialities  in  the  boundless  world  of  individual  endeavor,"  for 
easy  positions  with  small  responsibility.  Nevertheless,  experience  shows  that  Govern- 
ment is  not  a  model  employer.  It  overpays  incompetents  whose  only  asset  is  political 
"pull,"  and  underpays  the  meritorious.  It  recognizes  seniority  rather  than  ability. 
Experience,  foreign  and  American,  shows  that  the  Government  lags  far  behind  private 
enterprise  in  treatment  of  employees,  not  only  as  to  pay  for  services  rendered,  but  as  to 
pensions,  compensation  for  injuries,  and  general  conditions  of  employment. 

Political  Aspect 

Foreign  (Official) 77-79 

(Editorial) 79 

American  (Official)  79-86 

(Editorial) 86-92 

Foreign  officials  admit  that  in  their  administration  of  telephones  and  telegraphs,  their 
hands  have  been  tied  by  partisan  influence,  and  their  services  debilitated  by  political 
contamination.  United  States  Congressmen  admit  that  the  "merit  system,"  in  the 
making  of  appointments,  has  been  "prostituted  to  politics."  In  the  United  States,  bosses 
I  are  far  more  strongly  entrenched,  political  machines  far  more  potent,  and  partisan  in- 

fluences far  more  pernicious,  than  in  Europe.  A  new  government  enterprise,  especially 
of  such  magnitude  as  the  telephone  or  telegraph,  would  furnish  new  strength  to  the 
boss,  new  fuel  for  the  political  machine,  new  fields  for  partisan  influence.  It  would 
weigh  down  civic  reform  with  an  added  handicap,  and  might  permanently  engraft  upon 
our  democratic  institutions  a  system  of  centralized  bureaucracy,  "a  huge  political 
Frankenstein,  created  by  Democracy  for  its  own  eventual  destruction." 

6 


Regulation  vs.  Ownership 

Pages 

Official 92-93 

Editorial 93-96 

Public  R^ulation  secures  to  the  public  all  the  advantages  of  private  ownership,  and 
eliminates  its  disadvantages.  The  Government  is  in  a  better  position  to  regulate  and  y  > 
check  abuses  of  private  corporations,  than  to  regulate  and  check  its  own.  For  example, '  / 
it  has  rigidly  enforced  strict  standards  of  accounting  among  private  corporations, 
though  its  own  accounting  is  notoriously  lax  and  inadequate.  (See  "Arbitrary  and  Irre- 
sponsible Administration.")  It  would  be  the  height  of  folly  to  embark  upon  Govern- 
ment Ownership  just  when  Government  Regulation  is  beginning  to  show  what  it  can  do. 

Post  Office 

Official 96-98 

Editorial 98-102 

Government  management  of  the  Post  Office  is  no  precedent  for  Government  operation 
of  telephones  and  telegraphs.  The  postal  service  is  unique  in  its  simplicity  of  make-up 
and  ease  of  operation  ;  despite  which  it  meets  with  annual  deficits,  even  though  millions 
in  expenses  annually  incurred  by  the  Post  Office,  are  charged  to  other  departments. 
Its  administration  by  the  Government  in  this  country  has  revealed  defects  which,  in 
more  complex  enterprises,  would  be  fatal  alike  to  good  government  and  good  service. 
The  argument  that  the  parcels  post  is  a  precedent  is  eqiially  unsupportable.  It  involved 
no  change  in  the  nature  of  Post  Office  work,  but  merely  increased  its  volume,  throwing 
the  brunt  of  the  added  load  upon  private  carriers. 


PUBLIC  SENTIMENT 
(Foreign) 

The  Times,  London,  England,  November  2,  1913 : 

The  chorus  of  complaints  against  the  London  telephone  service  which  has  echoed  through  our 
columns  during  the  past  week  will,  it  may  be  hoped,  serve  as  a  corrective  of  the  prevailing  official  sat- 
isfaction with  the  British  system. 

The  Times,  London,  England,  May  18,  1912: 

The  experiment  of  the  Manitoba  Government  with  interior  grain  elevators  seems  to  have  resulted 
in  failure.  *  *  *  In  a  speech  in  the  Legislature,  the  Hon.  R.  P.  Roblin,  Provincial  Premier,  explained 
that  the  Government  embarked  upon  the  experiment  as  the  result  of  a  long  popular  agitation  in  which 
it  was  represented  that  the  grain  dealers  were  robbing  the  fanners  and  that  "the  panacea  is  to  be 
found  in  Government-owned  elevators."  He  added,  "I  took  the  voice  of  the  demagogue  as  the  voice  of 
die  public,  and  I  consequently  made  a  mistake." 

The  Daily  Mail,  London,  England,  Februar)-  5,  1912: 

The  complaints  of  telephone  users  grow  in  force  as  they  accumulate  in  numbers.  Every  class  of 
the  community  is  represented  in  the  increasing  army  of  disgusted  subscribers,  and  if  a  small  percentage 
of  the  complaints  which  pour  into  the  office  of  the  Daily  Mail  are  duplicated  to  the  newly  formed 
Telephone  Users'  Association  that  organization  will  find  its  hands  more  than  full. 

One  indignant  user  asks  what  would  be  the  advantage  to  the  community  of  the  nationalization  of 
the  railways,  land,  and  mines  if  the  new  telephone  system  is  an  example  of  efficiency  under  Government 
control.  Several  subscribers  write  that  complaints  to  officials  only  draw  stereotyped  acknowledgments. 
Apparently  the  replies  are  suggested  by  that  useful  post  office  volume  "The  Excuse  Book." 

The  Daily  Mail,  London,  England,  February  2,  1912: 

The  widespread  dissatisfaction  with  telephone  services,  expressed  in  many  letters  in  the  Daily 
Mail  recently,  has  led  to  the  formation  of  a  Telephone  Users'  Association,  with  Mr.  Goldman,  M.P., 
as  chairman. 

The  Daily  Mail,  London,  England,  Februar)-  1,  1912: 

Many  complaints  about  the  inefficiency  of  the  telephone  service  continue  to  reach  the  Daily  Mail. 
The  Post  Office  may  say  that  the  staffs  and  the  system  are  the  same  as  they  were  under  the  National 
Telephone  Company,  but  the  fact  remains  that  subscribers  are  almost  unanimous  in  stating  that  since 
the  Post  Office  took  over  the  telephones  there  has  been  a  marked  decline  in  their  efficiency. 


(American) 

Washington,  D.  C,  Herald,  January  5,  1914 : 

If  the  voice  of  the  press  of  the  country  affords  any  clue  to  public  sentiment,  the  people  of  the 
country  have  pronounced  with  practical  unanimity  against  Mr.  Burleson's  proposal. 

Paterson,  N.  J.,  Press,  December  24,  1913: 

The  press  of  the  country  without  discrimination  of  party,  has  with  practical  unanimity  declared 
the  project  (».  e.,  the  proposal  for  government  ownership  of  telephone  and  telegraph)  untenable. 

9 


;  J  „. ,,  ;  JBropklyp,  N.  Y.,  Citizen,  December  11,  1913 : 
'■'     "     There  are  so  many  other  matters  which  will  have  to  be  dealt  with  before  it  can  become  worth 
while  entering  into  any  detailed  argument  over  what  had  better  be  done  about  the  telegraph  and  tele- 
phone lines  that  the  question  must  remain  in  the  academic  list  on  this  side  of  the  Atlantic  for  another 
decade  at  least. 

It  is,  indeed,  true  that  there  are  not  a  few  intelligent  people  who  think  otherwise.  They  have 
become  convinced  in  various  ways  that  it  would  be  a  good  stroke  of  business  to  enter  these  fields  right 
away.  But  it  is  not  doubtful  that  the  great  majority  of  the  American  people  are  in  no  such  mood. 
The  complaints  of  the  two  services  have  been  so  few  and  are  really  so  trivial,  as  compared  with  other 
great  branches  of  industrial  life  that  call  for  attention,  that  the  average  American,  who  is  nothing  if 
not  practical,  declines  to  bother  himself  much  in  the  premises. 

Philadelphia,  Pa.,  Ledger  (Quoted  in  the  Rochester,  New  York,  Post  Express,  October  8, 
1913): 

For  Federal  regulation  of  interstate  concerns  the  nation  will  vote  its  indorsement.  For 
government  ownership  the  nation  will  vote  only  its  stoutest  condemnation. 

Rochester,  N.  Y.,  Union  Advertiser,  December  19,  1913 : 

We  do  not  believe  that  the  people  want  government  ownership  of  the  telephone,  the  telegraph 
or  the  transportation  service.  The  present  laws  for  the  regulation  of  the  public  service  corporations 
seem  to  be  adequate. 

Baltimore,  Md.,  American,  December  16,  1913: 

It  may  also  be  said  that  the  control  of  the  wires  by  the  government  would  be  a  precursor  of 
conditions  such  as  exist  in  France,  where  the  labor  organizations  have  the  telegraph  and  telephone 
employes  of  the  government  in  their  fellowship  and  thus  have  the  government  in  important  respects 
under  their  thumb.     All  this  leads  to  outright  socialism.    The  United  States  wants  none  of  it. 

Pontiac,  Mich.,  Press,  December  23,  1913 : 

Wouldn't  the  acquisition  of  telegraph  and  telephone  lines  pave  the  way  for  the  government 
ownership  of  railroads?  Would  the  service  be  any  better  than  it  is  now  and  could  the  government 
operate  these  industries  without  loss,  or  friction,  or  political  interference?  Wouldn't  there  be  many 
problems  from  which  we  are  now  free?  In  brief,  is  there  a  public  demand,  a  public  necessity,  for 
such  a  step,  and  would  it  be  advantageous  to  the  government  and  the  public  to  undertake,  in  these  cir- 
cumstances, a  move  in  a  direction  that  may  be  wrong?  Mr.  Burleson  seems  to  be  confident,  but  as  we 
see  it,  is  on  very  uncertain  ground. 

St.  Paul,  Minn.,  Dispatch,  October  9,  1913 : 

Even  a  Congress  of  radical  Democratic  persuasion  would  gag  at  the  thought  of  plunging  the 
country  into  a  system  which  is  unsuccessful  abroad  and  from  which  the  three  leading  foreign  nations 
would  gladly  escape  if  they  could  enjoy  the  benefits  of  modernized  American  services. 

Jacksonville,  111.,  Courier,  December  19,  1913 : 

We  are  justly  jealous  of  the  extension  of  government  activities,  and  we  have  not  as  a  nation  felt 
called  on  to  do  for  the  people  what  other  agencies  could  do  as  well. 

Chicago,  III.,  Journal,  December  22,  1913 : 

The  best  thing  about  the  peaceful  dissolution  of  the  telegraph  and  telephone  trust  is  the  evi- 
dence it  affords  that  President  Wilson  has  no  intention  of  adopting  the  suggestion  of  his  postmaster 
general,  and  moving  for  immediate  government  ownership  and  operation  of  telegraph  and  telephone 
lines. 

The  country  is  to  be  congratulated  on  the  very  evident  fact  that  his  recommendations  are  not  to 
be  followed. 

10 


BuflFalo,  N.  Y.,  Enquirer.  December  22,  1913 : 

Those  who  question  the  wisdom  of  government  ownership  merely  as  a  business  proposition, 
however,  are  only  a  part  of  the  array  in  opposition.  Another  very  strong  corps  of  objectors  hold  that 
running  telegraph  and  telephone  systems  is  not  suitable  work  for  the  United  States  government. 

Mansfield,  O.,  N'eu's,  February  5,  1914: 

The  more  closely  this  policy  is  examined,  the  more  hopeless  does  it  appear.  The  question,  of 
course,  is  a  political  as  well  as  a  business  one.  If  we  desire  a  great,  powerful,  centralized  Govern- 
ment we  can  go  far  toward  the  realization  of  our  wish  by  putting  it  in  charge  of  the  railroads  and 
other  business  enterprises.  By  so  doing,  we  shall  greatly  weaken,  and  perhaps  destroy,  those  very 
institutions  designed  by  wise  men  to  hold  despotism  in  check  and  to  safeguard  the  independence, 
initiative,  and  freedom  of  the  citizen.  We  should  have  an  army  of  voters  bound  to  the  state — that  is, 
the  administration — by  the  closest  and  most  selfish  ties,  and  strong  enough  to  mold  it  to  their  purposes. 

************ 

Men  are,  we  believe,  banning  to  see  the  dangers  inherent  in  this  whispered  program.  Many 
who  in  their  hearts  oppose  it  and  shrink  from  it,  have  made  the  mistake  of  talking  and  thinking  of  it  as 
"inevitable."  Nothing  is  inevitable  as  long  as  there  is  the  slightest  chance  of  preventing  it.  Those  who 
are  proposing  to  "accept"  what  they  think  they  can  not  head  off,  ought,  we  think,  to  express  them- 
selves clearly  and  forcibly.  We  believe,  as  we  have  said,  that  public  opinion,  as  a  whole,  is  far  from 
favorable  to  this  plan.     It  is  a  grave  mistake  to  interpret  silence  as  acquiescence. 

Syracuse,  N.  Y.,  Journal,  December  18,  1913: 

There  is  no  general  demand  for  the  Federal  government  to  buy  the  telegraph  lines.  There  is 
no  great  necessity  for  such  an  act.  Widespread  as  is  its  use,  necessary  as  it  has  become  in  business 
circles  and  great  as  is  its  convenience  in  the  home,  it  has  not  yet  reached  that  place  in  the  affairs  of  man 
where  Uncle  Sam  should  feel  even  the  suspicion  of  a  need  to  take  over  the  mighty  system  in  order 
that  he  might  furnish  cheaper  service. 


ECONOMIC   ASPECT 

Speech  of  Representative  Lewis  on  Telephones  and  Telegraphs  before  Congress  on  December 
22,  1913: 

Mr.  Speaker,  there  is  a  science  of  political  economy;  it  speaks  with  an  authority,  not  to  say 
with  a  thoroughness  of  analysis  and  breadth  of  view,  which  I  could  not  claim.  It  speaks,  too,  with  a 
responsible  sense,  a  knowledge  of  these  perplexing  varieties  and  complexities  of  modern  society  and 
industry. 

From  statement  made  by  Thomas  Jefferson  in  1808: 

Having  always  observed  that  public  works  are  much  less  advantageously  managed  than  the 
same  are  by  private  hands,  I  have  thought  it  better  for  the  public  to  go  to  market  for  whatever  it 
wants  which  is  to  be  found  there. 

From  "The  WeaUh  of  Nations,"  by  Adam  Smith  (1776.  Vol.  II,  Bk.  V.,  Ch.  II,  p.  300: 
The  Post  Office  is  properly  a  mercantile  project.  The  government  advances  the  expense  of 
establishing  the  different  offices,  and  of  buying  or  hiring  the  necessary  horses  or  carriages,  and  is 
repaid  with  a  large  profit  by  the  duties  upon  what  is  carried.  It  is  perhaps  the  only  mercantile  pro- 
ject which  has  been  successfully  managed  by,  I  believe,  every  sort  of  government.  The  capital  to  be 
advanced  is  not  very  considerable.  There  is  no  mystery  in  the  business.  The  returns  are  not  only 
certain,  but  immediate. 

11 


From  "Principles  of  Economics,"  (1911,  Volume  II,  Book  VII,  Chapter  62,  Page  409),  by  F. 
W.  Taussig,  Professor  of  Political  Economy  at  Harvard  University: 

The  continued  progress  which  it  (i.  e.  government  ownership)  should  maintain  calls  for  keen- 
ness, vigor,  enthusiasm,  single-minded  devotion  to  professional  tasks  on  the  part  of  trained  adminis- 
trators and  experts.  Only  an  intelligent  and  self-restrained  democracy,  or  a  very  capable  autocracy, 
can  enlist  such  men  and  get  them  to  do  their  work  in  the  best  spirit.  The  German  Empire  and  the 
German  states,  in  their  post  office,  telegraph  and  telephone,  ^perhaps  in  their  railways,  unmistakably 
in  their  military  organization,  have  maintained  a  high  spir'it  of  ambition  and  emulation.  But  the 
Australian  colonies  seem  to  have  secured  simply  humdrum  management ;  honest,  to  be  sure  (and  for 
this  much  we  in  the  United  States,  to  our  shame,  must  pay  our  tribute  of  respect),  but  devoid  of  life 
and  vigor.  No  democratic  community,  with  the  possible  exception  of  Switzerland,  has  shown  in  its 
public  industry  a  spirit  of  progress  comparable  to  that  of  private  industry. 

From  an  article  by  Dr.  Jacob  Gould  Schurman,  President  of  Cornell  University,  published  in 
the  New  York  Tribune,  February  25,  1912 : 

In  the  United  States  the  central  government  possesses  under  the  Constitution  a  minimum  of 
governmental  functions.  Yet  even  among  us  the  public  business  is  conducted  with  much  less  energy 
and  efficiency  than  private  business.  Although  some  European  states  own  and  manage  the  railways 
— never,  however,  with  great  success — we  hesitate  to  invest  our  government  with  this  function  because 
of  its  incompetency  as  a  business  agent  and  the  inefficiency  to  which  it  is  doomed  by  partisan  politics. 

From  "Public  Finance,"  (3rd  Edition,  1903,  Book  II.,  Chapter  3,  Pages  228-229),  by  C.  F. 
Bastable,  Professor  of  Political  Economy  at  the  University  of  Dublin,  Ireland : 

One  difficulty  common  to  most  forms  of  state  industry  arises  from  the  necessity  of  dealing 
with  large  numbers  of  employees.  The  tasks  of  the  modern  State  are  sufficiently  varied  and  compre- 
hensive to  take  up  all  the  ability  and  time  of  administrators,  without  adding  unnecessarily  to  their 
duties.  Public  industries,  however,  require  for  their  efficient  working  a  body  of  organized  hands, 
obtained  by  free  contract.  An  unavoidable  consequence  is  the  possibility  of  disagreement  between 
the  State  and  its  helpers,  culminating  perhaps  in  the  last  weapon  of  industrial  war — strikes.  *  *  * 
That  this  is  not  an  imaginary  danger  is  proved  by  the  fact  that  in  July,  1890,  there  were  "strikes"  at 
the  municipal  gasworks  in  Leeds,  at  the  London  Post  Office,  and  in  the  Metropolitan  Police,  and  also 
a  "mutiny"  in  the  Guards ! 

From  "Railroad  Transportation"  (1885,  Chapter  13,  Page  257),  by  Arthur  T.  Hadley,  LL.  D., 
President  of  Yale  University: 

Government  ownership  of  the  telegraph  prevailed  in  Continental  Europe,  because  each  country 
was  more  or  less  of  a  bureaucracy ;  that  is,  the  civil  service  governed  the  country,  and  was  so  well 
organized  that  it  extended  itself  as  a  matter  of  course.  In  America  the  civil  service  is  not  so  well 
organized,  does  not  govern  the  country,  and  is  not  allowed  to  extend  itself  as  a  matter  of  course. 
Political  reasons  decided  the  question  in  favor  of  a  government  telegraph  in  Europe.  Political 
reasons  form  the  main  ground  against  a  government  telegraph  in  the  United  States. 

From  the  preface  to  "The  History  of  the  British  Post  Office,"  by  J.  C.  Hemmeon,  Ph.D.,  pub- 
lished under  the  direction  of  the  Department  of  Economics,  as  Volume  VII  of  the  Harvard  Economic 
Studies  (January,  1912) : 

Possibly  a  democratic  type  of  government  should,  from  the  financial  point  of  view,  interfere 
least  in  the  direct  management  of  economic  institutions,  on  account  of  the  pressure  which  can  easily 
be  brought  to  bear  upon  it  for  the  extension  of  such  institutions  on  other  than  economic  grounds.  If 
non-economic  principles  are  to  be  substituted  in  justifying  the  initiation  or  increase  of  government 
ownership,  a  popular  form  oi  government  seems  the  least  suitable  for  the  presentation  of  such  as  shall 
be  fair  to  all  concerned,  not  to  mention  the  difficult  problem  of  dealing  with  those  members  of  the 
civil  service  who  do  not  hesitate  to  make  use  of  their  political  power  to  enforce  their  demands  upon  the 
government. 

12 


From  "The  Principles  of  Political  Economy,"  (1864,  5th  edition.  Part  1,  Chapter  9,  Pages  218 
and  231),  by  J.  R.  McCulloch: 

Perhaps,  with  the  single  exception  of  the  conveyance  of  letters  there  is  no  branch  of  industry 
which  government  had  not  better  leave  to  be  conducted  by  individuals. 

It  cannot,  however,  be  too  strongly  impressed  upon  those  in  authority,  that  non-interference 
should  be  the  leading  principle  of  their  policy,  and  interference  the  exception  only;  that  in  all  ord- 
inary cases  individuals  should  be  left  to  shape  their  conduct  according  to  their  own  judgment  and 
discretion ;  and  that  no  interference  should  ever  be  made  on  any  speculative  or  doubtful  grounds,  but 
only  when  its  necessity  is  apparent,  or  when  it  can  be  clearly  made  out  that  it  will  be  productive  of 
public  advantage. 

From  "Expansion  of  Races,"  (1909,  Chapter  XXVIII,  Page  433),  by  Charies  Edward  Wood- 
ruff. A.M.,  M.D : 

Hugo  R.  Meyer,  formerly  Professor  of  Political  Economy  in  the  University  of  Chicago,  has 
investigated  this  matter  for  many  years,  *  *  *  He  proves  conclusively  that  it  is  always  a  disaster 
to  the  society  if  the  ruling  units  take  charge  of  matters  which  the  working  units  alone  are  able  to  do. 
The  delusion  is  widespread  that  if  government  only  take  charge  of  something  it  is  done  properly,  even 
though  it  has  not  the  brains  or  bodies  to  work  with.  It  is  forgotten  that  the  brains  of  the  country  are 
apt  to  be  in  the  employ  of  corporations  and  will  not  work  for  the  poor  pay  of  government  office.  The 
delusion  arises  in  the  lower  layers  of  society — the  less  intelligent  ruled  elements — which  always  look 
up  to  the  rulers  to  initiate  and  manage  everything  for  them.  It  is  the  Russian  peasant's  stupid  way 
of  demanding  everything  of  "The  little  father" — the  Czar.  It  is  the  sign  of  racial  childishness  and  the 
opposite  of  the  Aryan  democratic  spirit.  Meyer  proves  that  State  ownership  or  regulation  invariably 
paralyzes  industry  because  it  interferes  with  that  private  initiative  which  has  made  America  the  leader. 
•  •  ♦  In  the  great  public  utilities,  telegraph,  telephone,  trolley  lines,  railroads,  lighting  power,  we 
lead  the  world.  State  management  in  Europe  has  paralyzed  advancement — individual  liberty  in 
America  has  pushed  it. 

From  a  speech  by  Charles  E.  Hughes,  Justice  of  the  United  States  Supreme  Court  and  ex- 
Govemor  of  New  York;  delivered  before  the  Republican  Oub  of  the  City  of  New  York,  January  31, 
1908: 

Our  government  is  based  upon  the  principles  of  individualism  and  not  upon  those  of  socialism. 


We  do  not  seek  to  multiply  the  activities  of  government  so  as  to  bring  about  vexatious  inter- 
ference with  liberty  or  to  restrict  legitimate  enterprise.  We  deprecate  all  unnecessary  governmental 
action.  But  our  individualism  does  not  justify  unbridled  license.  Its  aims  may  demand,  and  fre- 
quently do  demand,  the  intervention  of  government  with  necessary  restrictions  and  regulations,  not  to 
curtail  the  liberty  of  the  people,  but  to  protect  it. 

From  the  Congressional  Record,  January  15,  1914,  p.  1753: 

MR.  M(DON.  *  •  *  If  you  shall  adopt  the  policy  of  the  purchase  of  the  telegraphs  and  tele- 
phones, you  will  have  proceeded  far  to  the  federalization  of  power.  You  will  have  added  thousands  of 
offices  to  your  Government.  If  you  should  go  further  and  become  the  owners  of  the  railroads,  you 
would  see  a  vast  army  of  people  who  would  be  in  control,  a  Federal  menace  to  human  rights  and 
human  liberty  under  a  Constitution  and  laws  in  which  the  people  have  no  part  in  selecting  the  officers 
to  administer. 

Macon,  Ga.,  News,  December  19,  1913: 

John  Stuart  Mill,  one  of  the  clearest  and  most  profound  thinkers  of  the  nineteenth  century, 

13 


applied  his  practical  philosophy  to  the  subject  of  government  ownership,  and  among  other  things  he 

said: 

A  cogent  reason  for  restricting  the  interference  of  government  is  the  great  evil  of 
adding  unnecessarily  to  its  power.  Every  function  superadded  to  those  already  possessed  by 
the  government  causes  its  influences  over  hopes  and  fears  to  be  more  widely  diffused,  and 
converts,  more  and  more,  the  active  and  ambitious  part  of  the  public  into  hangers-on  of  the 
government.  If  the  roads,  the  railways,  the  banks,  the  insurance  offices,  the  great  joint  stock 
companies,  the  universities,  and  the  public  charities,  were  all  of  them  branches  of  the  gov- 
ernment; if  the  employees  of  all  these  different  enterprises  were  appointed  and  paid  by  the 
government,  and  looked  to  the  government  for  every  rise  in  life ;  not  all  the  freedom  of  the 
press  and  the  popular  constitution  of  the  legislature  would  make  this  or  any  other  country 
free  otherwise  than  in  name.  And  the  evil  would  be  greater,  the  more  efficiently  and  scien- 
tifically the  administrative  machinery  was  constructed. 

He  declared  also  that  the  perfection  of  government  ownership  would  establish  an  in- 
iquitous bureaucracy. 

Philadelphia,  Pa.,  Public  Ledger,  October  26,  1913: 

In  the  new  edition  of  the  "American  Commonwealth,"  James  Bryce  says  that  the  railroads  can- 
not be  taken  over  in  this  country  and  worked  by  the  National  Government  as  the  railways  of  Switzer- 
land and  many  of  those  in  Germany  and  the  Austro-Hungarian  monarchy.     And  he  added: 

"Only  the  most  sanguine  state  socialist  would  propose  to  impose  so  terrible  a  strain  on  the  virtue 
of  the  American  politician,  not  to  speak  of  the  effect  on  the  constitutional  balance  between  the  States 
and  the  Federal  authority." 

St.  Louis,  Mo.,  Times,  December  22,  1913 : 

Incentive  to  achievement  along  individual  lines  cannot  be  taken  away  from  a  people  save  to 
their  great  detriment.  The  fundamental  principles  of  Republican  form  of  government  are  best  exem- 
plified by  as  little  government  as  possible,  and  not  by  as  much  as  possible. 

San  Antonio,  Tex.,  Express,  December  19,  1913: 

The  argument  that  the  United  States  is  the  only  one  of  the  leading  countries  of  the  world  that 
is  not  operating  telegraph  lines  is  *  *  *  specious,  because  this  country  has  a  form  of  government 
different  from  that  of  most  of  the  other  great  nations,  which  cost  many  thousands  of  lives  to  estab- 
lish, and  that  has  been  the  admiration  of  all  the  world.  This,  the  people  of  the  United  States  will  not 
willingly  relinquish  for  a  monarchical  or  centralized  form  of  government,  towards  which  it  might  be 
headed  were  Mr.  Burleson's  policy  carried  out. 

Philadelphia,  Pa.,  Public  Ledger,  December  18,  1913: 

Mr.  Burleson  might  go  further;  if  communication  of  intelligence  is  important,  so  is  transporta- 
tion of  both  human  beings  and  freight,  and  therefore  the  next  logical  step  would  be  the  ownership  of 
our  twenty  billions  of  dollars  worth  of  railways.  Transportation  of  foodstuffs  is  important,  but  more 
important  yet  is  the  food.  Plow  can  a  prudent  and  wary  Government  permit  the  nation  to  be  endan- 
gered by  allowing  the  farmers  and  other  busy-bodies  to  retain  in  their  private  possession  the  very  staff 
of  life?  That  would  be  foolish,  of  course,  and  therefore  a  beneficent  paternal  Government  should, 
logically,  control  the  means  of  production  as  well  as  the  instruments  of  transportation  and  of  commun- 
ication. But  whence  originate  the  food-stuffs  and  other  necessaries  of  life?  From  this  goodly  earth; 
from  the  land,  which,  combined  with  labor,  is  the  source  of  practically  all  wealth :  is  it  safe  to  leave  the 
land  in  private  hands?  Logic — the  Burlesonian  communistic,  socialistic,  Texas  logic — compels  a 
logical  statesman  to  conclude  that  the  land  must  be  owned,  controlled  and  tilled  by  the  Government. 

From  "The  Science  of  Finance,"  by  Professor  H.  C.  Adams  (1898:  Part  II,  Bk.  I,  Ch.  2, 
Pages  274-5) : 

If  it  be  true,  as  has  been  argued  in  the  courts,  that  an  increase  in  the  volume  of  the  telephone 

14 


business  beyond  a  certain  point  necessitates  a  corresponding  increase  in  expenses,  this  fact  excludes 
the  telephone  industry  from  the  class  of  industries  industrially  monopolistic. 

From  "Economics,"  by  Professor  A.  T.  Hadley,  President  of  Yale  University  (1896,  Pages 
170-1): 

Shall  telephone  charges  be  based  on  the  message,  as  in  long-distance  business,  or  on  the  instru- 
ment, as  in  the  ordinary  local  business  ?  The  former  is  the  more  logical  basis,  but  it  involves  decided 
difficulties.  The  public,  in  local  telephone  exchanges,  distinctly  prefers  the  latter  method.  But  if  a 
company  charges  by  the  instrument  and  not  by  the  message,  we  are  brought  face  to  face  with  the 
remarkable  fact  that  the  expenses  per  unit  increase  with  an  increase  in  the  volume  of  business  done. 
In  a  town  with  only  100  telephones  in  operation,  the  expense  to  the  company  per  instrument  and  the 
rate  which  can  be  profitably  charged  is  far  less  than  in  a  city  with  1,000  instruments.  In  the  one  case, 
it  need  only  be  prepared  to  make  ninety-nine  connections  for  each  subscriber ;  in  the  other,  it  must  ar- 
range for  nine  hundred  and  ninety-nine.  This  will  serve  to  illustrate  the  highly  experimental  character 
of  the  problem  of  rate-making  in  the  newer  forms  of  industry.  It  is  difficult  enough  for  the  investors  to 
find  agents  who  can  be  trusted  to  experiment  with  property  under  these  conditions.  Still  more  diffi- 
ctUt  is  it  to  find  public  officials  who  can  be  trusted  to  experiment  with  other  people's  property. 

From  "Introduction  to  Economics,"  by  Professor  H.  R.  Seager,  of  Columbia  University  (3rd 
Edition,  1905,  Ch.  23,  Legal  and  Natural  Monopolies,  pages  450-2)  : 

It  (i.  e.  the  telephone  service)  is  not  subject  to  the  law  of  decreasing  expense.  On  the  contrary 
electrical  engineers  maintain,  and  with  apparent  reason,  that  the  larger  the  number  of  subscribers 
served  through  one  exchange  the  larger  is  the  expense  per  subscriber  of  rendering  the  service.  This 
is  because  the  exchange  stations  must  be  so  arranged  that  each  new  subscriber — or  pair  or  quartette 
of  subscribers  where  two  or  four  party  lines  are  used — may  have  his  wire  connected  readily  by  each  of 
the  many  operators  required  in  a  large  office  with  that  of  any  other  subscriber.  If  one  operator  is  able 
to  attend  to  the  calls  of  fifty  subscribers  and  the  office  serves  one  thousand,  this  necessitates  twenty 
different  terminals  at  the  exchange  for  each  wire.  If  the  number  of  subscribers  doubles,  each  separ- 
ate wire  must  be  let  in  at  forty  points.  If  five  thousand  subscribers  are  to  be  served,  each  wire  must 
have  one  hundred  distinct  terminals.  In  this  way  the  expense  at  the  central  office  increases  by  multi- 
plication rather  than  by  addition.  For  five  thousand  subscribers  not  five  times,  but  twenty-five  times 
as  many  connections  are  needed  as  for  one  thousand.  Nor  is  there  the  saving  of  expense  outside  the 
central  office  in  the  telephone  business  that  is  to  be  found,  for  example,  in  connection  with  electric- 
lighting.  For  the  best  service  it  is  necessary  to  have  a  distinct  wire  for  each  new  subscriber.  Fair 
service  can  be  given  to  two  parties  on  the  same  line.  Four-party  lines  are  less  satisfactory.  Lines 
serving  more  than  four  have  been  found  to  work  so  badly  that  they  are  now  little  used  in  cities.  Thus 
as  regards  outside  wiring  the  expense  grows  uniformly  with  the  number  of  subscribers.  There  are, 
of  course,  on  the  other  hand,  economies  in  administration,  etc.,  which  result  from  an  increase  in  the 
number  of  subscribers  and  which  must  be  taken  into  account.  On  the  whole  it  appears  to  be  true, 
however,  that  increasing  rather  than  diminishing  expense  is  the  law  of  growth  in  the  telephone  busi- 
ness. 


FOREIGN  EXPERIENCE  NO  PRECEDENT 

From  "Modem  Industrialism,"  (1904,  Part  III,  Chapter  4,  Pages  270-1),  by  P.  L.  McVey, 
President  of  the  University  of  North  Dakota. 

What  may  be  accomplished  under  a  monarchy  by  a  centralized  government  is  a  markedly 
different  thing  from  the  results  likely  to  come  from  a  government  under  a  democracy.  Australia 
stands  as  an  example  of  democratic  administration.  The  governments  are  by  no  means  so  free  from 
political  influences  as  those  of  Germany  and  do  not  offer  such  excellent  results.  But  on  the  other  hand 
the  experience  of  Australia  would  be  nearer  what  might  be  expected  in  England  or  America,  were  the 
state  system  introduced  rather  than  that  of  the  German  States. 

15 


The  administration  of  the  Australian  railroad  is  pretty  well  typified  by  a  statement  of  Sir 
George  Turner  to  the  effect  that  no  man  of  the  class  (naming  a  number  of  high  grade  managers) 
would  leave  England  to  enter  the  services  of  an  Australian  colony.  The  parliaments  have  insisted  upon 
the  retention  of  staffs  created  under  political  managements  of  former  administrations  and  have  inter- 
fered with  the  transactions  of  the  railroad  departments  for  political  reasons.  The  railroads  are 
starved  because  of  the  heavy  demands  upon  the  treasury  for  other  purposes,  the  result  is  poorly 
equipped  roads  carrying  small  train  loads  at  high  cost  per  ton  mile.  Expenses  are  not  always  paid 
out  of  current  income  and  resort  is  had  to  borrowing  that  materially  increases  the  public  debt. 
Demands  of  all  kinds  are  made  by  every  class,  from  every  section  and  these  are  of  such  a  nature 
that  they  preclude  anything  like  management  on  the  long-sighted  principle ;  the  roads  are  run  for  the 
present  and  with  the  future  in  view.  The  errors  of  judgment  are  not  written  off  as  in  the  case  of  a 
private  company  but  are  laid  upon  the  taxpayer,  whose  very  industry  is  burdened  by  a  condition  over 
which  he  has  no  control.  The  results  in  Australia  may  be  summed  up  in  three  brief  statements:  (1) 
Systematic  borrowing  until  the  State  Debt  is  beyond  any  reasonable  limit ;  (2)  dependence  upon  the 
State  for  employment  without  reference  to  the  product;  (3)  reliance  upon  government  borrowing  for 
continuance  of  prosperity.  These  in  addition  to  high  rates  and  inefficient  management  complete  the 
record  of  the  Australian  systems. 

From  "Aspects  of  Public  Ownership,"  by  Sydney  Brooks,  published  in  the  North  American 
Review,  August,  1911,  Pages  206-207: 

Another  set  of  considerations  that  are  even  more  relevant  concern  not  so  much  the  kind  of 
undertaking  that  it  is  proposed  to  nationalize  or  municipalize  as  the  kind  of  people  who  will  have  the 
management  of  it  when  it  passes  under  public  control — their  political  traditions  and  habits,  their 
administrative  experience  and  efficiency,  their  standards  of  official  honesty,  the  whole  environment 
and  atmosphere  in  which  they  will  be  called  upon  to  discharge  their  functions.  Here,  again,  it  is  not 
possible  to  lay  down  any  hard  and  fast  rule.  But  at  the  same  time,  it  is  not  merely  possible  and 
permissible,  but  vitally  essential  to  insist  that  the  differences  between  towns  and  countries  in  external 
circumstances,  political  formation  and  character,  industrial  instincts  and  administrative  aptitudes,  are 
just  as  great  as  between  individuals,  and  that  these  differences  profoundly  affect  the  problems  of 
Public  Ownership  and  make  it  more  than  usually  imperative  to  submit  the  argument  from  analogy 
to  a  merciless  dissection.  Local  and  national  ownership  and  operation  of  the  chief  public  services 
will  be  one  thing  in  a  country,  like  Germany,  where  the  bureaucratic  tradition  is  strong  and  individual 
initiative  perceptibly  weaker  than  collective  initiative,  and  another  thing  in  a  country,  such  as  the 
United  States,  where  the  best  brains  are  to  be  looked  for  outside  of  the  municipal,  State  and  Federal 
Governments  and  where  the  unit  has  consistently  shown  itself  immeasurably  more  enterprising  and 
efficient  than  the  group.  *  *  *  An  enterprise  that  is  conducted  successfully  and  with  economy  under 
a  stable  administrative  system  may  break  down  altogether  under  a  regime  that  favors  a  succession  of 
officials  on  short  or  precarious  tenures  or  that  is  exposed  to  the  unremitting  pressure  of  commercial 
or  political  interests. 

From  "Principles  of  Economics"  (1910,  6th  edition,  Appendix  A,  Page  753),  by  Alfred  Mar- 
shall, one  time  Professor  of  Political  Economy  at  Cambridge  University: 

In  Germany  an  exceptionally  large  part  of  the  best  intellect  in  the  nation  seeks  for  employment 
under  Government,  and  there  is  probably  no  other  Government  which  contains  within  itself  so  much, 
trained  ability  of  the  highest  order.  On  the  other  hand  the  energy,  the  originality  and  the  daring  which 
make  the  best  men  of  business  in  England  and  America  have  but  recently  been  fully  developed  in 
Germany;  while  the  German  people  have  a  great  faculty  of  obedience.  They  thus  differ  from  the 
English  whose  strength  of  will  makes  them  capable  of  thorough  discipline  when  strong  occasion 
arises  but  who  are  not  naturally  docile.  The  control  of  industry  by  Government  is  seen  in  its  best 
and  most  attractive  forms  in  Germany ;  and  at  the  same  time  the  special  virtues  of  private  industry, 
its  vigor,  its  elasticity  and  its  resource  are  beginning  to  be  seen  in  full  development  there.  In  conse- 
quence the  problems  of  the  economic  functions  of  Government  have  been  studied  in  Germany  with 

16 


great  care,  and  with  results  that  may  be  very  instructive  to  English-speaking  people;  provided  they 
recollect  that  the  arrangements  best  suited  for  the  German  character  are  perhaps  not  quite  the  best 
for  them;  since  they  could  not,  if  they  would  rival  the  Germans  in  their  steadfast  docility,  and  in 
their  easy  contentment  with  inexpensive  kinds  of  food,  clothing,  house-room  and  amusements. 

From  "Municipal  Ownership  In  Great  Britain,"  by  Professor  Hugo  R.  Meyer,  1906,  Chapter  6, 
p.  114: 

In  the  days  of  Adam  Smith,  speakers  and  writers  on  questions  of  public  policy,  when  con- 
fronted with  perplexing  problems,  used  to  surmount  the  difficulty  by  saying,  "It  has  been  done  in 
China."  The  public  speakers  and  writers  of  to-day  make  a  similar  use  of  Germany,  Australia,  and 
New  Zealand,  countries  concerning  which  the  general  public  has  acquired  more  misinformation  than 
an  energetic  and  well-informed  man  could  correct  in  a  lifetime. 

From  "Principles  of  Economics"  (1911,  Volume  II,  Book  VII,  Chapter  62,  page  409),  by  F. 
W.  Taussig,  Professor  of  Political  Economy  at  Harvard  University: 

The  continued  progress  which  it  (i.  e.  government  ownership)  should  maintain  calls  for  keen- 
ness, vigor,  enthusiasm,  single-minded  devotion  to  professional  tasks  on  the  part  of  trained  adminis- 
trators and  experts.  Only  an  intelligent  and  self-restrained  democracy,  or  a  very  capable  autocracy, 
can  enlist  such  men  and  get  them  to  do  their  work  in  the  best  spirit.  The  German  Empire  and  the 
German  states,  in  their  post  office,  telegraph  and  telephone,  perhaps  in  their  railways,  unmistakably  in 
their  miliUry  organization,  have  maintained  a  high  spirit  of  ambition  and  emulation.  But  the  Austra- 
lian colonies  seem  to  have  secured  simply  hundrum  management ;  honest,  to  be  sure  (and  for  this 
much  we  in  the  United  Sutes,  to  our  shame,  must  pay  our  tribute  of  respect),  but  devoid  of  life  and 
vigor.  No  democratic  community,  with  the  possible  exception  of  Switzerland,  has  shown  in  its  public 
industry  a  spirit  of  progress  comparable  to  that  of  private  industry. 

From  "Railroad  TransporUtion"  (1885,  Chapter  13,  Page  257),  by  Arthur  T.  Hadley,  LL.D., 
President  of  Yale  University: 

Government  ownership  of  the  telegraph  prevailed  in  Continental  Europe,  because  each  country 
was  more  or  less  of  a  bureaucracy ;  that  is,  the  civil  service  governed  the  country,  and  was  so  well  or- 
ganized that  it  extended  itself  as  a  matter  of  course.  In  America  the  civil  service  is  not  so  well  or- 
ganized, does  not  govern  the  country,  and  is  not  allowed  to  extend  itself  as  a  matter  of  course.  Poli- 
tical reasons  decided  the  question  in  favor  of  a  government  telegraph  in  Europe.  Political  reasons 
form  the  main  ground  against  a  government  tel^raph  in  the  United  States. 

From  The  Nation  (New  York),  March  14,  1912: 

We  subscribe  to  no  such  dogma  as  the  "impossibility"  or  "absurdity"  of  government  owner- 
ship or  management  of  public  utilities.  It  is  all  a  question  of  expediency — a  question,  to  be  sure, 
turning  often  on  extremely  broad  and  deep  considerations,  and  not  merely  on  the  immediate  facts  of 
a  given  case,  but  still  a  question  of  expediency.  It  is  fair  to  acknowledge,  and  to  take  for  what  it  is 
worth,  such  an  experience  as  that  of  Switzerland,  especially  as  Switzerland  is  a  democratic  republic. 
But  before  we  jump  to  conclusions  r^jarding  our  own  country,  we  must  look  certain  large  and  vital 
facts  in  the  face.  Of  these,  the  most  obvious  relates  to  the  mere  geography  and  history  of  the  coun- 
try. The  United  States  is  a  vast  new  country,  whose  area — we  speak  of  the  contiguous  territory,  not 
counting  Alaska,  or  the  insular  possessions — is  3,000,000  square  miles ;  Switzerland  is  an  ancient  and 
fully  settled  country,  with  an  area  of  16,(XX)  square  miles.  Texas  alone  could  swallow  up  sixteen 
Switzerlands,  and  the  population  of  Texas  is  barely  more  than  that  of  Switzerland.  It  would  take 
nine  Switzerlands  to  make  a  Montana,  but  the  people  of  Montana  are  only  one-tenth  as  many  as  those 
of  Switzerland.  Evidently,  the  problem  of  reconciling  the  demands  of  the  present,  and  of  weighing 
the  needs  of  the  future,  for  this  vast  Continental  area,  filled  with  a  restless,  energetic  and  rapidly 
growing  population  and  big  with  mighty  changes  almost  from  year  to  year,  is  not  to  be  compared  with 
that  presented  by  the  transportation  problems  of  the  compact  and  ancient  little  mountain  republic  of 
Europe. 

17 


From  "Aspects  of  Public  Ownership,"  by  Sidney  Brooks,  published  in  the  North  American 
Review,  August,  1911,  pages  200-201 : 

*  *  *  One  of  the  most  common  and  preposterous  fallacies  of  our  times  is  to  suppose  that  there 
are  any  political  dogmas  which  are  universally  true  or  any  political  prescription  which  can  be  applied 
indiscriminately  or  any  political  machinery  which  does  not  depend  for  nine-tenths  of  its  value  upon 
the  engineers  and  the  local  conditions  under  which  they  work.  *  *  *  The  type  of  mind  which  argues 
that  because  Glasgow  has  made  a  success  in  owning  and  operating  the  local  service  of  street-cars, 
therefore  Pittsburg  or  San  Francisco  would  be  equally  successful  and  should  at  once  follow  in  Glas- 
gow's footsteps,  is  a  type  of  mind  that  really  ought  not  to  be  allowed  to  meddle  with  politics.  It  is 
fundamentally  incapable  of  appreciating  the  fact  that  the  forces  which  determine  the  success  or  fail- 
ure of  any  and  every  political  experiment  are  infinitely  more  local  than  general  and  more  personal 
than  mechanical. 

New  York  Tribune,  December  19,  1913: 

It  is  to  be  borne  in  mind,  too,  that  governmental  service  in  some  other  countries  is  possible  up- 
on the  theory  exactly  the  reverse  to  ours.  Their  theory  is  that  the  Government  should  be  compre- 
hensively paternal  and  so  should  do  as  much  as  possible.  The  American  principle  is,  everything 
should  be  left  to  private  initiative,  which  the  general  welfare  does  not  require  to  be  done  by  the 
Government  or  which  the  Government  cannot  do  very  much  better  than  private  individual  or  cor- 
poration. The  burden  of  proof  of  one  of  these  latter  conditions,  therefore,  rests  with  the  advocates 
of  the  change. 

Extract  from  an  editorial  in  the  Seattle,  Wash.,  Times,  September  23,  1913: 

That  the  acquisition  of  the  telegraphs  would  constitute  a  grave  issue  none  can  question.  The 
question  of  governing  the  union  employes  of  the  present  corporation,  much  as  it  is  to  the  fore  in 
present  discussions  of  the  subject,  would  be  one  of  the  smallest  items. 

There  is  no  real  comparison  between  the  situation  in  European  governments,  where  telegraphs 
are  publicly  administered,  and  those  that  would  be  developed  in  the  United  States. 

In  Europe,  they  are  under  national  control  as  a  war  measure  or  because  the  governments  need 
the  financial  returns  accruing  from  their  operation.    Neither  of  these  needs  is  present  in  the  republic. 

San  Francisco,  Cal.,  Post,  October  13,  1913 : 

England,  on  the  other  hand,  is  thickly  settled;  there  are  no  "dead  lines"  through  unprofitable 
territory  and  the  Government  has  not  been  required  to  make  extension  into  isolated  districts  to  be 
operated  at  a  constant  loss. 

From  "Public  Finance"  (1899,  Part  II,  Chapter  10,  Page  264),  by  W.  M.  Daniels,  formerly  of 
the  Department  of  Political  Economy,  Princeton  University,  and  recently  appointed  by  President  Wil- 
son member  of  the  Interstate  Commerce  Commission: 

If  we  are  to  make  use  of  analogy  as  a  guide  in  such  matters,  the  experiment  which  deserves  our 
most  careful  study  is  the  English  experiment  with  the  telegraphs.  Here  was  a  nation  whose  industrial 
habits  were  most  nearly  like  our  own.  Here  was  an  industry  whose  acquisition  cost  far  less  than  the 
railroads,  and  whose  administration  was  immensely  simpler.  Moreover,  conservative  financial  opinion 
had  pronounced  in  favor  of  the  experiment.  So  careful  a  student  as  Jevons  had  concluded  that  state 
telegraphs  would  be  successful  largely  for  the  same  reasons  which  had  made  the  state  management  of 
the  post  successful.  It  was  found,  however,  that  the  economies  secured  by  unity  of  management  were 
oflFset  by  the  higher  salaries  paid  to  employes,  and  that  the  government  had  to  obtain  a  monopoly  for 
the  state  telegraph,  though  formerly  such  an  intention  had  been  disclaimed.  The  financial  failure  of 
the  experiment  is  hardly  in  question.  A  successful  pressure  of  the  telegraph  personnel  for  higher 
pay,  and  an  invincible  demand  by  the  public  for  lower  rates,  proved  to  be  the  upper  and  nether  mill- 
stones between  which  the  financial  success  of  the  undertaking  was  ground  to  powder. 

18 


New  York  Times.  December  28,  1913 : 

Conceivably  the  service  which  might  suit  EngHsh  customers  would  not  serve  the  want  of  Amer- 
icans, but  the  fact  is  that  the  British  envy  us  what  the  Representative  (Mr.  Lewis)  describes  as  un- 
fit for  our  approval.  It  is  sure  that  no  American  will  envy  England's  telephone  service  as  described 
in  the  leading  British  Journal. 

According  to  the  London  Times  "the  history  of  the  telephone  in  the  United  Kingdom  has  been 
of  a  lamentable  tale  of  bureaucratic  blundering  tolerated  by  a  community  which  has  failed  to  conceive 
the  potential  method  of  communication,  and  to  insist  upon  its  effective  organization  on  a  business 
basis."  The  fact  which  shows  British  inappreciation  is  that  the  telephones  per  100  population  are 
1.4%  in  England  to  8.1%  in  the  United  States.  London  has  2.8%  per  100  and  New  York  has  more 
than  London,  Berlin,  Paris  combined,  although  London  alone  has  a  larger  population.  The  reason 
for  the  British  backwardness,  which  Mr.  Lewis  wishes  us  to  emulate,  was  the  British  ownership  of 
the  postal  telegraph.  *  ♦  ♦ 

In  the  opinion  of  those  who  have  experience  of  the  British  system  "the  money  value  of  the 
time  and  temper  wasted  by  the  public  from  a  bad  service  is  a  far  more  serious  consideration  than  any 
reasonable  charges  imposed  for  a  good  one,  on  the  principle  that  speed  and  reliability  are  more  im- 
portant than  cheapness." 

Providence,  R.  I.,  Journal,  January  1,  1914: 

That  the  telephone  is  a  vexation  in  England,  is  shown  by  the  comparison  of  the  telephone  and 
the  mail:  17.7  is  the  percentage  of  telephone  messages  and  80.5  is  the  percentage  of  the  communica- 
tion sent  by  mail.  The  preference  for  the  mail  in  Gr^at  Britain  thus  is  nearly  5  to  1.  In  the  United 
States  conditions  are  reversed:  The  mail  takes  less  than  41  per  cent,  of  the  messages,  while  more 
than  58  per  cent,  is  handled  by  the  telephone  companies. 

Philadelphia,  Pa.,  Public  Ledger,  December  22,  1913: 

The  London  Times  has  had  an  expert  review  the  situation  for  the  benefit  of  its  readers.  His 
conclusion  published  a  few  days  ago,  ought  to  be  interesting  on  this  side  of  the  ocean,  also. 
He  points  out  that  the  Government  decided  several  years  ago  to  take  over  all  telephone  lines  and  that 
the  private  company,  which  was  operating  under  a  terminable  franchise,  did  not  make  the  improve- 
ments in  its  plant  that  it  would  have  made  had  it  anticipated  retaining  control  of  its  business.  But  he 
says,  even  if  telephone  progress  had  not  been  retarded  by  the  impending  Government  control,  "the 
rapid  advance  that  is  a  vital  commercial  necessity  to  the  country  is  not  being  made  for  the  simple  rea- 
son that  a  Government  department  is,  to  judge  from  experience,  unable  to  carry  on  a  great  profit- 
making  commercial  concern  on  a  sound  business  basis."  During  both  periods,  therefore,  the  period 
of  private  control  and  since  the  Government  has  taken  over  the  private  lines,  he  concludes  that  the 
telephones  and  the  public  "have  suffered,  and  still  are  suffering  from  the  influence  of  government 
control." 

San  Francisco,  Cal.,  Chronicle,  December  31,  1913: 

In  many  countries  with  Government-owned  'phones,  the  system  is  a  joke.  Indeed,  it  is  a  mark 
of  social  distinction  to  have  a  "number."  As  for  the  telegraph,  it  is  closed  down  for  24  hours  every 
week  in  certain  government  ownership  countries  and  it  is  impossible  to  send  messages  after  9  o'clock 
at  night  or  before  8  o'clock  in  the  morning. 

Lowell,  Mass.,  Courier-Citizen,  December  24,  1913: 

Meantime  the  telephone  service  of  this  country  is  the  most  efficient  in  the  world.  No  foreign 
service  that  Mr.  Lewis  can  find  so  much  as  approaches  it  either  in  extent  or  in  excellence.  Com- 
pared on  the  basis  of  the  number  of  available  exchanges  to  be  talked  with,  the  rate  in  the  United 
States  is  infinitely  lower  per  subscriber  than  it  is  in  any  other  country  on  the  foot-stool.  The  rate  is 
constantly  decreasing;  the  number  of  new  telephones  is  steadily  rising. 

19 


'  New  York  Evening  World,  December  22,  1913: 

How  many  Americans  have  had  actual  experience  of  government  ownership  as  it'  exists  in 
other  countries?  How  many  Americans  understand  how  foreign  are  most  of  its  results  to  our  habits 
of  personal  freedom  and  to  our  standards  of  efficiency? 

In  England  the  increasing  burden  of  the  government  telegraphs  upon  taxpayers  has  been  no- 
torious. Germany  makes  its  government  telegraph  system  a  handy  instrument  of  espionage.  France, 
although  a  republic,  does  much  the  same.  Government  in  both  these  countries  is  essentially  bureau- 
cratic. Wherever  even  a  degree  of  militarism  prevails,  government  ownership  is  bound  to  lend  itself 
to  spying  and  repression. 

Moreover,  any  American  who  has  ever  done  any  telephoning  in  France  does  not  need  to  be 
told  of  the  exasperating  inefficiency  and  slowness  of  the  French  system.     The  same  applies  to  Italy. 

Switzerland  hasn't  found  out  yet  whether  it  likes  government  ownership  or  not.  The  system 
was  adopted  on  a  theory  of  unification  that  may  work  in  a  country  the  size  of  Switzerland.  Govern- 
ment ownership  for  less  than  four  million  people  is  a  different  thing  from  government  ownership  for 
one  hundred  million. 

Japan  took  over  its  railroads,  telephones  and  telegraph  to  provide  war  assets.  The  result  has 
been  in  every  way  bad.  The  Japanese  Government,  forced  by  military  burdens  to  economize,  has 
found  itself  unable  to  make  extensions.  Not  fifty  miles  of  new  road  have  been  built  since  govern- 
ment ownership  became  a  fact.  It  takes  six  months  to  get  a  telephone  installed,  and  the  less  said  about 
the  service  the  better. 

Americans  who  are  used  to  enterprise,  initiative,  rapid  improvement  and  wide  extension  in 
their  public  utilities,  to  say  nothing  of  personal  liberty  and  freedom  from  surveillance  in  their  conduct 
and  business,  will  find  government  ownership  as  it  works  in  other  countries  a  poor  argument  for  foist- 
ing it  upon  Uncle  Sam. 

Utica,  N.  Y.,  Herald-Dispatch,  December  20,  1913: 

If  Government  control  of  wire  systems  could  anywhere  be  made  a  success  from  a  financial 
standpoint,  it  would  be  in  Great  Britain,  where  political  influence  is  reduced  to  a  minimum  in  the  op- 
eration of  public  utilities.  Yet  the  British  Government  has  notoriously  failed  to  make  either  the  tele- 
graph or  telephone  branch  of  the  Post  Office  service  self-sustaining.  It  is,  therefore,  reasonable  to 
suppose  that  with  the  vastly  greater  temptation  which  the  numerous  wire  systems  of  this  country 
would  offer  to  intriguing  politicians,  the  ventures  of  government  operation  would  be  a  disastrous 
failure. 

New  York  Evening  Sun,  December  19,  1913 : 

But  there  can  be  little  doubt  that  if  a  referendum  were  taken  among  the  people  who  have  had 
a  chance  to  try  Government-owned  systems  of  Europe  and  the  privately-owned  systems  of  the  United 
States,  the  Government  ownership  proposal  in  this  country  would  be  snowed  under. 

Boston,  Mass.,  Advertiser,  December  11,  1913: 

Where  Mr.  Burleson  could  find  such  example  is  difficult  to  imagine.  Surely  not  in  England 
where  the  Christmas  mail  was  recently  threatened  by  a  strike  of  Government  employes.  It  was  only 
the  announced  determination  on  the  part  of  the  British  authority  to  call  out  the  troops  and  use  them 
in  the  interest  of  the  Post  Office,  which  prevented  the  strike  from  being  called.  Should  Mr.  Burle- 
son turn  to  France  for  his  illustration,  he  would  have  to  explain  away  the  terrible  strike  which  tied 
up  French  railroads  some  years  ago. 

Had  not  the  Premier  called  the  military  reserve  and  set  them  to  the  task  of  running  the  rail- 
roads, France  would  have  nearly  starved  in  a  very  short  time. 

Mr.  Burleson  ought  to  know  that  in  Canada  there  are  several  Government-owned  railroads 
which  are  in  a  plight  to  which  the  present  condition  of  the  B.  &  M.  is  as  nothing. 

Brooklyn,  N.  Y.,  Eagle,  December  18,  1913 : 

Over  his  Government  telegraph  lines  an  Englishman  may  send  a  telegram  for  6  pence,  but  at 

20 


the  end  of  the  year  the  taxpayers,  as  a  whole,  must  make  up  the  heavy  deficit  due  to  a  combination  of 
low  rates  with  the  expensive  management  which  government  operation  of  public  utilities  everywhere 
entails.  Mr.  Burleson  is  not  fortunate  in  citing  the  British  system  as  an  argument  in  favor  of  his 
policy,  and  there  is  also  a  Government  telephone  service  in  Great  Britain,  and  it  is  notoriously  among 
the  worst  in  the  world. 

Brooklyn,  N.  Y.,  Times,  December  18,  1913: 

But  the  main  objection  to  the  proposal  arises  from  the  fact  that  a  distinct  deterioration  in 
service  would  be  the  inevitable  result  of  the  acquisition  by  the  Government  of  these  great  public  utili- 
ties. As  President  Vail  of  the  Telephone  Company  well  points  out,  there  are  more  telephones  in  New 
York  City  than  in  the  entire  United  Kingdom  where  the  Government  operates  the  system.  In  for- 
eign countries  the  telephone  is  not  a  necessity.  Indeed,  it  is  in  a  sense  a  luxury.  With  us  it  is  as 
necessary  as  the  trolley  car  or  the  restaurant. 

Chicago,  111.,  Manufacturers'  News,  December  18,  1913: 

Since  England  took  over  the  tel^^raph  lines,  it  has  been  confronted  with  an  annual  deficit  of 
approximately  $6,000,000.  This  does  not  prevent  the  telegraph  employes  from  asking  for  a  15%  ad- 
vance in  wages. 

The  English  ministry  is  opposed  to  further  advance  in  the  postal  and  telegraph  employes'  wages 
for  reasons  that  their  wages  and  pension  allowance  have  been  twice  advanced  during  the  last  six  years. 
The  public  also  resents  the  demand  made  at  the  holiday  season. 

The  present  ministry  is  having  an  exceedingly  hard  fight  to  give  the  Government  employes  and 
working  men,  in  general,  everything  they  asked  for,  including  old  age  pension,  insurance  and  higher 
wages  without  running  the  country  so  badly  into  debt  that  it  will  never  get  out  of  it. 

New  Haven,  Conn.,  Register,  December  13,  1913: 

Fortunately  government  ownership  of  telephones,  either  national,  state  or  municipal  has  been 
tried  out  in  a  good  many  parts  of  the  world.  While  it  seems  in  some  instances  to  be  working  fairly 
well,  its  failure  has  been  so  marked  in  many  well  observed  cases  as  to  lead  to  the  suspicion  that  it 
really  is  a  failure  everywhere.  For  even  the  fact  of  a  good  service  would  not  alone  serve  to  commend 
it.  VN'e  need  to  know  that  it  promotes  economy  in  the  use  of  the  peoples'  money,  and  conscientious 
accounting  for  the  great  capital  entrusted.    This  has  not  been  the  showing. 

Lawrence,  Kansas,  Gazette,  December  4,  1913: 

Government  ownership  does  not  seem  to  help  things  along  to  any  great  extent.  In  England, 
where  the  Government  owns  the  telegraph  as  well  as  the  postal  lines,  there  is  a  strike  coming  on 
that  threatens  to  trouble  the  Kingdom  grievously.  The  government  employes  want  an  advance  in 
wages ;  the  Government  refuses  to  grant  it ;  the  employes  have  ordered  a  Christmas  strike,  and  have 
begun  the  trouble  by  destroying  records,  smashing  typewriters,  short-circuiting  the  wires  and  play- 
ing other  little  jokes  of  the  kind. 

Erie,  Pa.,  Dispatch,  December  8,  1913: 

That  strike  in  Great  Britain  of  the  Government's  postal  and  telegraph  employes,  100,000  of 
them,  was  averted  just  in  time.  It  would  have  been  a  particularly  nasty  time  for  such  a  strike. 
That,  by  the  way,  is  one  of  the  pleasant  possibilities  of  Government  ownership.  The  only  difference 
would  be  that  in  this  country  the  number  would  be  so  much  greater  and  the  chances  proportionately 
so. 

Chicago,  111.,  Inter-Ocean,  October  7,  1913: 

It  may  be  expedient  to  take  over  or  destroy  the  present  telephone  and  telegraph  companies: 
The  Inter-Ocean  is  among  those  who  believe  it  is  not  expedient.  In  other  countries  "Government- 
ownership"  has  made  lower  efficiency  and  high  costs. 

21 


Some  years  ago  it  was  figured,  nor  was  the  accuracy  of  it  denied,  that  British  government 
ownership  of  the  telegraph  had  loaded  upon  the  taxpayers  a  loss  of  $175,000,000,  increasing  at  the 
rate  of  $5,000,000  a  year. 

Boston,  Mass.,  Truth,  November  22,  1913 : 

Public  ownership  of  railroads,  telephone  and  telegraph  would  mean  socialism ;  and  if  anyone 
wants  to  know  what  that  means  let  him  spend  a  few  months  in  New  Zealand,  as  Mr.  Geo.  W.  Moore, 
of  Brookline,  Mass.,  recently  did,  getting  first  hand  information  in  the  Socialist  hot-bed  of  the  world. 

"The  country,"  said  Mr.  Moore,  "is  run  by  labor  leaders  for  the  benefit  of  labor  leaders  and 
is  practically  bankrupt.  English  capitalists  have  furnished  the  money  to  keep  the  Government  going 
so  far,  but  further  loans  have  recently  been  refused. 

************ 

"Practically  the  only  right  enjoyed  by  the  alleged  freeman  is  the  right  to  be  poor  and  abstain 

from  work." 

************ 

"Graft,  inefficiency,  laziness,  indifference,  poverty  and  vice  seem  to  be  the  principal  products 
of  the  system,  and  in  the  production  of  these  it  is  all  that  can  be  desired  of  the  vicious  opponent  of 
modern  civilization." 

Lawrence,  Mass.,  American,  November  14,  1913: 

Mr.  Samuel  found,  to'  be  sure,  as  we  all  know  it  is  true,  that  on  this  side  of  the  Atlantic  long 
distance  calls  do  not  always  get  through,  that  there  are  exasperating  delays  and  that  wrong  numbers 
are  sometimes  given  here  as  well  as  in  England.  But  more  important  to  know  is  his  remark  that 
in  his  official  opinion  the  British  Government  telephone  will  some  time  become  as  efficient  as  he 
found  the  American  private  system.  That  means,  of  course,  that  if  we  make  telephonic  communica- 
tion a  government  service,  it  is  more  likely  to  deteriorate  than  improve ;  for  the  British  Post  Office  is 
so  efficient  that  it  would  be  folly  to  expect  that  American  Government  telephone  would  be  as  well 
administered  as  the  British. 

Leslie's  Weekly,  New  York,  November  6,  1913: 

Governmental  telegraph  ownership  is  not  an  open  question,  however.  Great  Britain  has  en- 
joyed government  ownership  and  operation  of  telegraph  lines  for  the  past  forty  years,  and  in  that 
time  its  Post  Office  telegraph  monopoly  has  produced  a  total  deficiency  of  $87,000,000.  At  present 
taxpayers  of  Great  Britain  are  paying  at  the  rate  of  $4,200,000  annually  to  enjoy  the  luxury  of  gov- 
ernmentally  operated  telegraph  lines.  The  principal  reason  for  this  is  uncommercial  and  extravagant 
management  due  to  political  control. 

New  York  Commercial,  October  31,  1913: 

The  British  taxpayer  and  telephone  user  is  growing  highly  indignant  over  the  delay  in  revi- 
sion of  telephone  rates.  He  knows  that  the  present  telephone  rates  are  a  burden  and  a  cause  of 
confusion,  and  he  evidently  believes  that  the  telephone  business  has  been  in  the  hands  of  the  Post 
Office  Department  long  enough  to  give  its  officials  a  chance  to  plan  a  permanent  system  and  rate  of 
charges  for  the  use  of  the  telephone. 

The  Liverpool  Daily  Post,  a  staunch  government  organ,  has  recently  devoted  considerable  space 
to  the  scandalous  break-down  in  the  telephone  service  in  that  city  and  to  the  utter  inefficiency  of  the 
postal  authorities  when  handling  this  branch  of  their  work.  The  telephone  business  is  in  its  infancy 
in  England  and  its  growth  has  been  completely  stunted  since  the  government  got  hold  of  it.  With 
the  post  office  in  charge  of  the  telephone  service  in  Liverpool  the  suburban  post  offices  in  that  city 
close  very  early  in  the  evening  and  the  telephone  switchboard  closes  with  the  rest  of  the  post  office. 
The  result  is  that  telephone  service  is  practically  suspended  through  the  residence  districts  and  a 
large  part  of  the  business  section  of  a  city  that  is  the  third  port  in  the  world,  and  from  eight 
o'clock  in  the  evening  until  seven  o'clock  in  the  morning  two-thirds  of  the  subscribers  to  the  telephone 
service  find  their  communication  completely  cut  off. 

22 


Boston,  Mass.,  Commercial  Bulletin,  October  11,  1913: 

According  to  the  London  Times,  Parliament  was  induced  to  transfer  the  telegraph  lines  to  the 
State  in  1871,  in  the  belief  that  the  .monopoly  would  be  a  lucrative  one  for  the  country.  To  what 
extent  this  expectation  has  been  borne  out  is  disclosed  by  the  statement  that  the  forty  years  of  Gov- 
ernment monopoly  of  the  telegraph  have  produced  a  loss  of  more  than  $87,000,000. 


That  the  Government  has  not  made  a  commercial  success  of  the  telegraph  is  due,  says  the 
Times,  to  extravagant  management  and  political  control.  Traffic  has  shown  a  steady  increase  and 
innumerable  improvements  have  been  made  in  equipment  and  methods  of  working,  yet  it  costs  the 
Post  Office  appreciably  more  to  handle  a  fifteen-word  message  of  to-day  than  it  cost  to  handle  a 
thirty-word  message  of  twenty-five  years  ago. 

St.  Paul,  Minn.,  Dispatch,  October  9,  1913: 

England  went  into  the  experiment  with  the  telegraph,  found  the  estimate  cost  quadrupled,  and 
after  doubling  the  Government  investment  encountered  an  annual  deficit  of  over  $5,000,000,  and  now 
coldly  proposes  to  deteriorate  the  service  and  increase  the  rates  to  balance  the  books.  With  our  rap- 
idly increasing  efficiency  of  service  and  cheapening  of  cost,  what  would  America  think  of  a  proposal 
like  that  ? 

Minneapolis,  Minn.,  Tribune,  October  8,  1913: 

France  has  one  telephone  for  each  group  of  171  inhabitants.  We  have  a  telephone  for  each 
group  of  12.  Our  service  is  so  superior  to  that  of  the  French  that  their  journals  are  now  calling  for 
improvements  in  the  direction  of  the  "American  standard." 

England  has  had  an  extremely  unhappy  experience  with  her  state-owned  telegraph  system. 
She  paid  four  times  the  estimated  cost  to  obtain  it ;  and  she  has  since  doubled  her  capital  expendi- 
ture. The  investment  has  never  earned  interest ;  it  has  failed  to  pay  operating  expenses.  The  New 
York  Times  gives  the  commercial  loss  of  the  transaction  at  "$175,000,000  some  years  ago,"  and  states 
"that  the  current  loss  is  $5,000,000  annually." 

Germany  owns  both  telegraph  and  telephone.  Her  Government  managers  have  estimated  the 
annual  depreciation  of  the  plant  at  45,000,000  marks.  A  sinking  fund  has  been  maintained  several 
years  at  that  rate.  The  maintenance  has  lately  required  so  large  an  increase  that  this  allotment  has 
been  reduced  to  25,000,000  marks. 

Seattle,  Wash.,  Times,  September  23,  1913: 

In  Europe  they  are  under  national  control  as  a  war  measure  because  the  Governments  need  the 
financial  returns  accruing  from  their  operation.    Neither  of  these  things  is  present  in  the  republic. 

The  experiments  along  these  lines  previously  have  not  been  distinguished  by  their  success. 
The  Government  cable  to  Alaska  is  a  case  in  point.  Seattle  residents  have  had  a  bitter  experience 
with  the  high  rates  imposed  on  communication  with  the  territory. 


ARBITRARY   AND   IRRESPONSIBLE  ADMINISTRATION 

{Foreign — Official) 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  p.  632: 

Mr.  Alan  Svkes:    *    •    *   With  regard  to  the  question  of  the  telephone  service    *    •    •    I 
may  mention  a  case    *    *    *    which  also  happened  to  an  hon.  Member  on  this  side,  and  the  hon. 

23 


Member  happens  to  be  myself.  My  telephone,  which  is  often  out  of  order,  was  out  of  order  on  a 
certain  occasion,  and  I  sent  a  message  to  the  officials.  Nothing  was  done,  and  it  was  still  out  of 
order  the  next  day.  I  sent  another  message  the  next  day,  but  nothing  was  done.  I  did  not  send  a 
message  the  next  day,  but  I  sent  one  the  day  after.  Still  nothing  was  done.  I  then  took  advantage 
of  the  fact  of  being  a  Member  of  the  House  of  Commons,  and  addressed  a  personal  letter  to  the  Post- 
master-General and  put  the  position  before  him,  and  with  his  usual  courtesy  he  took  it  up,  and  the 
question  was  inquired  into.  The  reply  he  sent  me  was  to  the  effect  that  no  record  had  been  made 
of  the  first  complaint,  that  an  operator  had  received  the  second  complaint  and  had  considered  that 
the  machine  was  all  right,  and  had  not  reported  it  to  the  engineer,  and  that  the  engineer  had  exam- 
ined the  third  complaint  and  could  not  find  anything  wrong,  and  it  was  only  when  I  communicated 
with  the  right  hon.  Gentleman  and  the  engineer  made  another  examination  that  it  was  found  that 
there  was  something  omitted  and  that  the  telephone  was  not  in  proper  order.  If  I  had  not  had  an 
opportunity  of  communicating  with  the  right  hon.  Gentleman  the  telephone  would  in  all  probability 
still  be  out  of  order,  and  I  should  probably  have  done  what  a  good  many  others  do  who  use  the  tele- 
phone, got  tired  of  making  complaints  and  perhaps  thrown  up  my  telephone. 

Truth,  London,  England,  December  11,  1912: 

His  Honour  Judge  Gye  made  some  very  strong  comments  last  week  at  the  Portsmouth  County 
Court  upon  the  iniquity  of  telephone  contracts.  He  had  to  determine  a  claim  by  the  Postmaster- 
General  for  telephone  rent.  The  subscriber  had  given  notice  of  discontinuance.  The  Post  Office 
authorities  cut  off  communication,  but  left  the  instrument  and  then  sued  for  the  rent.  This  under 
the  contract  they  are  empowered  to  do.  Judge  Gye  remarked  that  it  was  "a  shockingly  immoral  con- 
tract," and  he  said  so  "advisedly  and  intentionally."  He  had  no  option  but  to  decide  for  the  plaintiff, 
for  the  case  was  governed  by  a  decision  in  the  High  Court,  though  he  was  convinced  that  an  injus- 
tice would  be  done  the  defendant.  He,  however,  marked  his  opinion  by  making  an  order  for  pay- 
ment of  the  amount  claimed  at  the  rate  of  6d.  a  month.  His  Honour's  condemnation  of  the  contract 
is  not  a  whit  too  strong,  and  I  trust  his  remarks  will  be  brought  to  Mr.  Herbert  Samuel's  notice. 
Anyone  who  has  read  the  contract  through  knows  that  it  is  inequitable,  and  places  the  subscriber 
absolutely  at  the  mercy  of  the  department. 

British  Parliamentary  Debates,  Official  Report,  May  20,  1912: 

Mr.  Godfrey  Collins:  I  desire  to  draw  the  attention  of  the  Postmaster-General  to  three 
points  on  his  estimate.  The  first  is  the  misleading  profit  shown  by  the  Post  Office.  The  second  is 
the  large  and  growing  loss  on  the  telegraph  service;  and  the  third  is  the  danger  that  the  telephone 
service  may  show  a  loss  to  the  public  in  future  years.  According  to  the  House  of  Commons  Paper 
No.  96,  the  profit  on  the  Post  Office  is  £5,153,000.  Naturally,  the  House  and  the  public  think  that  is 
the  true  profit ;  but  when  we  come  to  analyse  these  figures  more  closely,  we  find  that  the  Post  Office 
do  not  charge  themselves  with  the  cost  of  works  and  buildings,  amounting  to  £569,000,  nor  with  rates 
and  taxes,  amounting  to  £126,000,  nor  even  with  stationery  and  printing,  amounting  to  £196,000.  In 
other  words,  the  profit  is  a  fictitious  profit  to  the  extent  of  20  per  cent.,  and  the  figures  which  I 
have  mentioned  include  these  and  other  charges  amounting  to  £890,000.  So,  therefore,  the  profit 
made  was  positively  some  20  per  cent,  less  than  the  statement  issued  by  the  Postmaster-General  led 
us  to  anticipate. 

From  the  Report  of  the  Royal  Commission  Appointed  to  Investigate  the  Postal,  Telegraph  and 
Telephone  Services  of  the  Commonwealth  of  Australia  (ordered  to  be  printed  October  5,  1910)  : 

70.     The  Department  furnishes  annual  statements  showing  only  revenue  receipts 
Stetemenu  from  its  chief  branches,  and  the  total  expenditure,  including  new  works,  for  all  branches 

Useless  pf  t}jg  service.    Such  statements  are  absolutely  useless  for  the  purpose  of  supplying  the 

requisite  information  to  determine  the  financial  position  of  its  several  branches. 

24 


{Foreign — Editorial)  ' 

The  Times,  London,  England,  December  26,  1913: 

"Hope  Deferred"  sends  us  the  following  details  of  his  experiences  in  obtaining  the  telephone. 
Commenting  on  the  state  of  "hopeless  confusion"  they  indicate,  he  says: — "In  our  case  it  was  stated 
that  'special  steps'  were  being  taken.  The  result  of  these  'special  steps'  was  that  we  had  to  wait  for 
the  telephone  23  days  after  handing  in  the  agreement.  If  such  unwarrantable  delays  occur  with 
'special  steps,'  whatever  must  it  be  like  without  them?" 

November  5,  1913. — Applied  to  X'auxhall  Bridgeroad  Post  Office,  asking  what  to  do  to  obtain 
a  telephone.  They  directed  me  to  the  Westminster  District  Post  Office.  They  in  turn  directed  me  to 
the  Contracts  Office,  34,  Gerrard-street,  Soho,  to  whom  I  wrote  on  November  5. 

November  11. — Having  received  no  reply,  I  applied  to  a  third  post  office  and  was  given  a  third 
diflFerent  address — namely,  144a,  Queen  \ictoria-street.  I  went  personally  here  and  found  what  I 
needed — the  telephone  agreement,  which  I   filled  in  and  signed  then,  November  11. 

November  14. — Wrote  to  the  Controller,  but  received  no  reply. 

November  17. — I  wrote  to  the  Secretary,  G.  P.  O.,  complaining  of  the  excessive  delay  and 
difficulty  in  getting  the  telephone.  This  resulted  in  a  printed  fomi  by  return  of  post  saying  that  the 
matter  should  receive  attention. 

November  19. — Still  dead  silence  from  the  Controller's  office,  so  1  wrote  again  reminding  them 
that  we  were  wanting  the  telephone  and  that  they  had  had  the  agreement  eight  days,  etc. 

November  20. — No  reply.     Wrote  again  to  the  Controller. 

November  21. — Received  a  letter  from  the  Controller  (dated  20th  inst.)  saying  that  the  mat- 
ter had  been  referred  to  the  sectional  engineer  and  that  the  matter  would  receive  "prompt  and 
adequate  attention,"  etc.  I  spoke  to  the  sectional  engineer  by  telephone,  and  he  knew  nothing  about 
us,  but  promised  to  send  a  man  round  to-morrow  (22nd). 

November  22. — .Again  spoke  to  the  sectional  engineer  by  telephone.  He  denied  his  promise 
of  yesterday ;  said  that  they  were  busy,  that  they  were  making  special  efforts  in  our  case,  and  that 
we  should  have  to  wait. 

November  24. — Practically  all  my  letters  to  the  Controller  are  completely  ignored ;  wrote  to 
him  once  again  to  remind  him  about  our  telephone. 

November  25. — Received  a  letter  from  the  Controller  dated  22nd,  and  altered  in  pencil  to 
the  24th,  acknowledging  my  letters  of  the  19th  and  20th  inst.,  and  saying,  inter  alia,  "special  steps  are 
being  taken  to  complete  the  circuit  at  an  early  date."  It  is  interesting  to  observe  that  it  took  two  days 
to  post  this  letter.  Another  letter  about  the  entry  in  the  Telephone  Directory  dated  22nd,  and  altered 
in  pencil  to  the  25th,  shows  a  period  of  three  days  Ijctween  writing  and  posting. 

November  27. — I  received  two  different  letters  of  the  26th  inst.  from  the  Controller  giving  our 
"probable"  telephone  number.  One  of  these  letters  also  states  "the  completion  of  the  installation  is 
receiving  special  attention." 

On  November  28  and  29  the  instruments  were  put  up  in  our  offices,  and  it  had  been  promised  by 
the  sectional  engineer,  by  telephone,  two  or  three  times,  that  the  installation  should  be  completed  by 
the  29th  at  the  very  latest  without  fail. 

December  1. — I  telephoned  to  the  sectional  engineer,  and  he  said,  "Oh,  isn't  your  telephone 
completed  yet?"  He  advised  me  to  ring  up  the  Controller's  office,  which  brought  forth  the  usual 
promises,  but  no  result. 

December  2. — Wrote  a  formal  letter  of  complaint  to  the  Secretary,  G.  P.  O.  Communicating 
with  the  sectional  engineer  by  telephone,  I  was  now  informed  that  there  was  some  more  outside  work 
to  be  done,  but  that  we  should  have  the  telephone  in  a  few  days. 

December  4. — The  telephone  was  actually  completed,  and  we  were  able  to  use  it  from  about 
4  p.  m.,  23  days  after  the  handing  in  of  the  agreement. 

Leicester,  England,  Mail,  December  23,  1912: 

In  reference  to  the  State  acquisition  of  the  telephones,  with  which  we  dealt  in  a  leading  article 
last  week,  a  local  correspondent  calls  our  attention  to  the  onerous  and  one-sided  conditions  which  the 

25 


Postmaster-General  has  inserted  in  the  form  of  contract  which  subscribers  have  now  to  sign.  He 
objects  particularly  to  the  seventh  and  ninth  paragraphs  of  the  "general  conditions"  under  which  the 
Postmaster-General  can  break  the  contract  without  penalty  or  responsibility  while,  if  the  subscriber 
is  guilty  of  the  slightest  lapse  in  any  matter  whatever,  he  is  liable  to  a  fine  in  the  form  of  "liquidated 
damages"  where  no  damage  is  done.  Under  the  tenth  paragraph  enormous  powers  of  inspection  are 
given,  not  only  to  the  subscribers'  premises,  but  "all  other  premises  under  the  subscribers'  control," 
while  another  paragraph  provides  that  the  certificate  of  any  subordinate  official  of  the  Post  Office  shall 
be  "conclusive  evidence"  of  the  matters  certified.  Our  correspondent  wrote  to  the  Postmaster-General 
pointing  out  clause  by  clause  the  objectionable  points  in  this  agreement,  only  to  be  told  that  it  had  been 
drawn  up  by  a  solicitor  and  could  not  be  modified.  "Those  who  think,"  adds  our  correspondent,  "that 
the  State  ever  can  run  a  business  at  its  best,  speak  without  knowledge." 

The  Times,  London,  England,  December  19,  1913: 

Charles  Straker  and  Sons  (Limited),  Bishopgate-avenue,  who  were  sued  in  the  City  of  London 
Court,  yesterday,  by  the  Postmaster-General,  for  18s.  9d.,  balance  due  for  telephone  calls,  complained 
that  they  had  been  charged  for  30  times  as  many  calls  as  they  had  had  and  said  they  defended  the 
case  in  order  to  make  a  public  protest. 

Mr.  Registrar  Wild,  in  giving  judgment  for  the  Postmaster-General  with  costs,  told  the 
defendants  that  there  was  no  remedy,  no  matter  how  much  they  were  overcharged,  as  they  had  signed 
an  agreement  admitting  that  the  Postmaster-General's  books  were  unquestionable,  however  inaccurate 
they  might  be.  The  defendants  must  go  to  Parliament  and  get  the  agreements  altered.  They  could 
not  do  without  the  telephone,  and  yet  they  could  not  get  it  without  signing  an  agreement  under  which 
they  had  no  voice  in  the  question  of  the  number  of  calls. 

Troy,  N.  Y.,  Record,  October  6,  1913 : 

Prince  Charles  Wreed,  captain  of  a  cavalry  in  the  German  army,  has  been  fined  $7  because 
poor  telephone  service  caused  him  to  tell  the  girl  operator  that  he  considered  her  office  a  hog  pen. 
The  Prince's  offense  comes  under  the  head  known  as  beamtenbeleidigung.  Being  a  Government 
employe,  the  girl  could  insist  that  her  service  should  be  respected.  In  extenuation  of  his  act  the 
officer  said  that  the  service  was  really  almost  worthless.  While  the  prosecution  acknowledged  this  con- 
dition, the  fact  that  he  had  been  discourteous  could  not  be  overlooked.  Fortunately  for  many  of  our 
people,  they  are  not  using  the  telephone  service  which  is  under  Government  direction. 

Rochester,  N.  Y.,  Post-Express,  October  6, 1913 : 

Complaint  against  the  wretched  telephone  system  of  one  of  the  Government  exchanges  in  a 
European  city  brought  out  the  official  threat  that  if  the  expression  of  dissatisfaction  did  not  cease,  the 
telephone  service  in  the  city  would  be  discontinued  for  one  year. 

There  is  talk  of  the  nationalization  of  American  telephones  and  telegraphs. 

The  Daily  Mail,  London,  England,  September  16,  1912: 

The  Englishman's  home  is  supposed  to  be  his  castle.  Alas !  it  is  nothing  of  the  kind.  Every 
person  who  signs  a  telephone  contract  opens  his  gate  to  the  wooden  horse,  and  from  that  moment 
the  particular  Briton  becomes  the  veriest  slave,  helpless,  without  redress,  and  minus  the  most  ele- 
mentary rights,  save  the  right  to  pay  and  overpay — in  advance.  The  amazing  thing  is  that  the  Briton 
does  it,  but  he  does. 

The  Daily  Mail,  London,  England,  February  6,  1912 : 

Most  serious  of  all  the  complaints  against  the  telephone  service  is  the  financial  loss  entailed  by 
wrong  calls. 

Correspondents  protest  against  their  helplessness  in  the  matter.  They  have  no  remedy  in  check- 
ing the  calls  debited  against  them.  They  must  pay  for  whatever  number  of  calls  the  authorities  state 
is  registered  against  them.  Argument,  the  subscriber's  own  record  of  his  calls  are  of  no  avail.  If 
he  does  not  pay  the  official  reckoning,  his  telephonic  connection  is  peremptorily  severed. 

26 


(American — Official) 

Congressional  Record,  January  15,  1914: 

Mr.  Calder:  *  *  ♦  An  employe  of  a  railroad  or  any  other  corporation  or  employer  can 
bring  suit  in  a  civil  court  for  damages  for  injuries  received,  and  can  recover  an  amount  assessed  by 
a  jury.  An  employe  of  the  Government  is  estopped  from  bringing  any  such  action,  no  matter  what 
the  cause  of  his  injuries  may  be,  and  he  lias  no  redress  whatever. 

From  official  statement  issued  by  Postmaster-General  Burleson,  for  publication  in  morning  news- 
papers of  May  30,  1913: 

*  *  *  Notwithstanding  the  great  zeal  displayed  in  the  effort  to  place  the  Department  on  the 
so-called  paying  basis  and  the  resultant  injuries  to  the  service,  the  claim  of  the  former  Postmaster- 
General  that  the  service  actually  yielded  a  profit  in  1911  has  no  foundation  in  fact.     *     *     * 

It  is  to  be  further  noticed  that  the  balance-sheet  as  heretofore  prepared  concerned  itself  en- 
tirely with  the  revenues  from  postage  and  the  operations  of  the  Department  and  expenditures  under 
the  appropriation  for  the  service  of  the  Post  Office  Department.  In  addition  to  this,  the  Department 
should  be  able  to  make  a  complete  statement  of  its  financial  status,  which  should  include  the  admin- 
istrative expenses  of  the  Department,  the  expenses  of  the  Auditor's  office,  and  a  fair  charge  for  the 
maintenance  of  Federal  buildings  used  exclusively  or  in  part  for  post-office  purposes  as  items  of  cost. 
It  has  not  been  the  custom  to  include  these  in  the  balance-sheet. 

From  the  Message  to  Congress  by  President  Taft,  January  17,  1912: 

Notwithstanding  that  voluminous  reports  are  compiled  annually  and  presented  to  the  Congress, 
no  satisfactory  statement  has  ever  been  published  of  the  financial  transactions  of  the  Government  as 
a  whole.  Provision  is  made  for  due  accountability  for  all  moneys  coming  into  the  hands  of  officers 
of  the  Government,  whether  as  collectors  of  revenue  or  disbursing  agents,  and  for  insuring  that 
authorizations  for  expenditures  as  made  by  law  shall  not  be  exceeded.  But  no  general  system  has 
ever  been  devised  for  reporting  and  presenting  information  regarding  the  character  of  the  expendi- 
tures made,  in  such  a  way  as  to  reveal  the  actual  costs  entailed  in  the  operation  of  individual  services  and 
in  the  performance  of  particular  undertakings ;  nor  in  such  a  way  as  to  make  possible  the  exercise  of 
intelligent  judgment  regarding  the  discretion  displayed  in  making  expenditure  and  concerning  the 
value  of  the  results  obtained  when  contrasted  with  the  sacrifices  required. 

(American — Editorial) 

New  York  Sun,  December  22,  1913 : 

A  wise  and  virtuous  Congress  has  decreed  that  the  post-offices  over  which  Mr.  Burleson  presides 
shall  sternly  repress  the  habit  of  correspondence  on  Sundays,  and  every  conceivable  obstacle  is  cour- 
ageously interposed  between  the  man  who  wants  a  letter  and  the  object  of  his  desire.  Would  a  Gov- 
ernment telephone  be  conducted  on  the  same  high  principles  ? 

It  is  notorious  that  many  frivolous  conversations  are  carried  on  over  the  wires  on  the  first  day 
of  the  week.  Moreover,  these  conversations  are  frequently  for  the  promotion  of  plans  that  have  not 
the  approval  of  those  who  would  restore  the  New  England  observance  of  the  day  to  a  country  which 
has  somewhat  discarded  it.    Could  a  Government  telephone  system  countenance  such  trivialities? 

Certainly  not:  the  exchanges  would  shut  up  on  Saturday  nights  and  open  on  Monday. 

St.  Louis,  Mo.,  Times,  December  22,  1913 : 

It  is  a  perfectly  simple  proposition  that  those  who  seek  to  govern  large  public  services  should 
be  amenable  to  the  law.  So  long  as  individuals  seek  to  perform  these  public  services,  there  are 
always  methods  of  redress  when  injustices  have  been  done.  If  these  methods  are  not  practicable  or 
if  they  are  not  applied,  the  fault  is  one  that  can  be  remedied. 

But  the  government  is  greater  than  the  law;  and  into  its  composition  there  go  large  numbers 
of  men  who  are  incompetent  and  others  who  are  dishonest. 

27 


Chicago,  111.,  Inter-Ocean,  May  27,  1913: 

In  connection  with  the  collapse  of  the  recreation  pier  at  Long  Beach,  Cal.,  on  Saturday,  by 
which  thirty-six  persons  were  killed  and  nearly  twice  as  many  seriously  injured,  there  are  circum- 
stances which  should  give  pause  to  some  eager  advocates  of  "public  ownership"  and  of  the  "more 
government"  proposition  generally. 

The  pier  belonged  to  and  was  erected  by  the  city  of  Long  Beach,  which  is  a  seaside  suburb  of 
Los  Angeles.  It  was  built  eight  years  ago,  and  is  stated  in  the  Associated  Press  dispatches  from  the 
scene  to  have  received  since  no  repairs  on  the  part  which  fell,  directly  in  front  of  the  "municipal 
auditorium"  which  was  a  part  of  the  structure. 

In  a  word,  public  ownership  did  not  secure  any  better  attention  to  the  safety  of  the  public  using 
the  pier  than  would  have  been  given  by  the  most  "greedy  and  reckless"  private  ownership.  In  fact,  it 
probably  secured  less  attention,  for  had  the  pier  been  a  private  enterprise  the  responsible  public 
officials  would  have  had  somebody  else  instead  of  just  themselves  to  inspect  and  regulate  and  keep  up 
to  the  mark,  demanded  by  considerations  of  public  safety. 

Saturday  Evening  Post,  December  14,  1912: 

There  is  hardly  a  state,  city  or  town  in  this  country  that  makes  an  intelligible  statement  of  its 
fiscal  operations  and  condition. 

Every  state,  city  and  town  publishes  once  a  year  a  thing  it  calls  a  treasurer's  report  or  an  audi- 
tor's report — usually  a  very  bulky  thing,  containing  an  interminable  maze  of  figures.  We  venture  to 
say  offhand  that,  as  to  about  two-thirds  of  these  reports,  the  best  expert  accountant  in  the  United 
States  could  not  construct  from  them  such  a  concise  and  intelligible  showing  of  income,  outgo,  indebt- 
edness and  cash  on  hand  as  the  New  York  Stock  Exchange  requires  from  every  corporation  whose 
securities  it  lists.  As  to  three-quarters  of  them,  we  venture  to  say  that,  if  any  such  confused,  occult 
statement  were  laid  before  the  directors  of  a  railroad,  those  directors  would  stand  up  in  righteous 
indignation  and  discharge  the  whole  accounting  department  on  the  instant. 

New  York  Times,  April  3,  1912: 

There  are  those  who  are  urging  that  we  should  administer  the  telegraph  and  telephone  through 
the  government,  and  who  support  the  proposal  by  pointing  to  the  success  with  which  the  Post  Office 
is  administered.  This  current  year  the  Post  Office  reports  a  surplus  *  *  *  But  the  Post  Office  sur- 
plus disappears  if  it  is  charged  with  the  cost  of  the  buildings  in  which  it  transacts  its  business.  If 
it  were  to  be  charged  with  all  other  unitemized  costs,  it  might  appear  that  the  stamp  which  costs  2 
cents  at  the  Post  Office  window  really  cost  the  buyer  as  much  again.  It  is  sure  that  the  Post  Office 
itself  has  no  idea  what  it  costs  to  carry  a  letter  or  newspaper  either  one  mile  or  a  thousand  miles. 
In  other  words,  the  Post  Office  shows  a  profit  by  ignoring  the  burdens  carried  by  all  commercial  un- 
dertakings and  transacts  its  business  in  defiance  of  the  first  conditions  of  solvency  in  private  affairs 
and  contrary  to  the  principles  it  enacts  for  the  guidance  of  common  carriers.  To-day  the  franking 
privilege  burden  on  the  Government  rivals  the  former  pass  burden  on  the  railways.  Depreciation  is 
an  unknown  entry  in  Government  accounts.  Income  is  so  far  despised  that  it  is  proposed  to  operate 
the  Panama  Canal  without  tolls,  although  there  are  other  than  financial  reasons  to  the  contrary. 

From  "Principles  of  Economics"  (1911,  Vol.  II.,  Bk.  VII.,  Ch.  62),  by  F.  W.  Taussig,  Pro- 
fessor of  Political  Economy  at  Harvard  University : 

*  *  *  Every  person  who  has  looked  into  the  accounts  of  a  railway  or  iron  works  or  large 
manufacturing  concern  knows  how  necessary  it  is  to  analyze  the  figures,  and,  above  all  the  state  of 
the  capital  account,  before  judging  whether  the  management  has  been  good.  To  supervise  public  offi- 
cials, and  to  judge  whether  their  administration  has  been  efficient,  becomes  the  more  difficult  as  plant 
is  larger  and  more  complex.  The  more  one  is  disposed  to  entertain  general  doubt  as  to  the  probable 
success  of  public  officials,  the  more  is  one  averse  to  intrusting  such  business  to  their  hands. 

28 


COMPARATIVE  EFFICIENCY 

(Official) 

Congressional  Record,  January  19,   1914,  page  1973: 

Mr.  McCumber:  *  *  *  No  one  will  deny  that  we  can  not  expect  the  same  personal  interest, 
the  same  curtailment  of  expenses,  the  same  unfailing  watchfulness  when  the  Government  has  to  pay 
the  bills  as  when  we  must  pay  them  ourselves.  Government  ownership  of  railways,  telegraph  lines, 
and  other  public  utilities  means  bad  service,  extravagance,  and  a  menace  to  the  rights  of  all  the 
people. 

Extract  from  a  paper  by  R.  C.  Erskine  (Civil  Service  Commissioner,  Seattle,  Washington), 
read  at  the  First  Annual  Conference  of  the  League  of  Pacific  Northwest  Municipalities,  October  24 
and  25,  1912: 

The  other  day  I  asked  four  large  employers  in  Seattle  which  they  would  rather  hire  of  two 
men  of  equal  natural  capacity  and  training,  one  having  worked  for  a  city  and  the  other  for  a  private 
employer  for  the  five  years  since  leaving  school.  Three  of  these  employers  said  they  would  hire  the 
man  who  had  been  with  a  private  concern  and  the  fourth  said  that  while  private  employment  was 
more  apt  to  develop  a  good  worker  than  public,  it  was  the  policy  of  his  house  not  to  hold  a  man's  past 
business  experience  too  much  against  him  and  he  would  give  either  of  the  applicants  a  chance  to  make 
good. 

From  "The  U.  S.  Government's  Shame"  (1908),  by  Edwin  C.  Madden,  Third  Assistant  Post- 
master General  from  July  1st,  1899,  to  March  22nd,  1907,  pp.  25-26: 

The  average  time  of  Postmasters  General  is  less  than  two  years.  They  come  in  at  the  head  of 
a  service  of  which  they  know  practically  nothing  and  never  stay  long  enough  to  learn.  If  all  the  Post- 
masters General  for  the  past  twenty  years  could  be  taken  one  at  a  time  and  questioned,  it  is  doubtful 
if  one  of  them  would  be  able  to  tell  offhand  the  rates  of  postage  on  mail  matter,  much  less  any  of  the 
vast  details  of  the  great  system. 

British  Pariiamentary  Debates,  Official  Report,  May.  20,  1912,  pp.  1599-1600: 

Sir  G.  Doughty  :  *  •  •  I  listened  with  very  great  interest  to  the  right  hon.  Gentleman's  state- 
ment respecting  the  telephone  service.  I  know  it  is  very  bad,  and  it  requires  very  great  changes  before 
it  might  be  called  decently  comparable  with  either  the  United  States  or  Canada.  *  *  *  In  the  United 
States  they  have  over  eight  million  telephones  in  constant  use,  and  they  can  do  it  on  the  very  best 
lines  owing  to  their  long  experience  and  their  method  of  working. 

British  Pariiamentar}-  Debates,  Official  Report,  June  19,  1911,  p.  86: 

Mb.  Morton  :  *  *  *  I  am  sorry  to  hear  to-day  that  the  Americans  are  so  far  in  advance  of  us 
in  this  matter  of  the  telephone.  We  pride  ourselves,  I  suppose,  on  being  as  much  advanced  as  other 
people,  but  it  is  worth  while  bearing  in  mind,  now  we  are  told  that  the  Americans  are  a  long  way  in 
advance  of  us  in  their  telephone  service,  that  the  service  there  is  under  a  private  company  and. that 
they  are  obliged  to  look  after  their  customers  better  than  a  Government  Department. 

British  Pariiamenur>'  Debates,  Official  Report,  June  19,  1911,  p.  52: 

Mr.  Herbert  Samuel  (Postmaster-General) :  ♦  ♦  *  We  have  been  closely  watching  the  de- 
velopment of  the  telephone  system  in  the  United  States — the  country  which  was  its  original  home,  and 
where  it  has  reached  its  highest  development.  For  many  years  representatives  of  my  Department  have 
been  visiting  the  United  States  in  order  to  acquire  information  there.  The  head  of  the  telephone 
branch  of  the  Post  Office  has  been  to  the  United  States,  and  the  chief  engineer  has  also  made  an  ex- 
haustive studjr  of  the  telephone  system  there.  The  telephone  traffic  manager  has  only  just  returned. 
We  have  established  a  system  of  travelling  scholarships  for  Post-Office  engineers  which  will  enable 

29 


Defects  in 
management 


them  to  go  over  to  the  United  States  for  considerable  periods  in  order  to  make  a  minute  study  of  the 
telephone  in  that  country. 

From  the  Report  of  the  Royal  Commission  appointed  to  Investigate  the  Postal,  Telegraph  and 
Telephone  Services  of  the  Commonwealth  of  Australia  (ordered  to  be  printed  October  5,  1910) : 

Disregard  of  ^^"^-     *    *    *    So  far  as  Construction  materials  are  concerned,  the  Department 

mrthlfds!  '""""^      has  been  working  in  a  most  primitive  manner,  exhibiting  an  utter  disregard  of  ordi- 
nary business  methods,  and  entailing  a  cumbersome  and  expensive  system  of  purchase. 

9.     Your  Commissioners,  during  their  inquiry  into  the  management  of  the  Post 
and  Telegraph  Department,  discovered  defects  which  were  due  to  lack  of  efficient 
management  as  distinct  from  the  system  of  control,  and  also  defects  which  were  in- 
herent in  the  system.    In  framing  this  Report  endeavors  have  been  made  to  broadly 
and  system.  Separate  the  defects  of  system  from  those  of  management.     It  is  evident  that  an  in- 

ferior system,  even  under  sound  management,  would  make  for  an  indifferent  service. 
When,  however,  an  inferior  system  is  associated  with  a  weak  and  limited  manage- 
ment, the  results  are  disastrous. 

Report  of  Select  Committee  on  Post  Ofiice  Servants  (ordered  printed  by  House  of  Commons. 
July  24,  1907) : 

Salaries  of  Sorting  Clerks  and  Telegraphists  {In  the  Provinces). 

Par.  254.  Representations  were  *  *  *  made  (to  the  Committee)  that  the  minimum  estab- 
lished wage  was   *    *   *   insufficient. 

Par.  256.  The  department  replied  that  in  their  opinion  the  rates  of  pay  and  the  avenues  of 
promotion  were  adequate.  *  *  *  "That  the  Government  was  obliged  to  tolerate,  owing  to  Parlia- 
mentary pressure,  a  degree  of  inefficiency  which  in  private  employment  would  lead  to  dismissal  of  the 
employee." 

(Editorial) 

The  Daily  Mail,  London,  England,  January  2,  1914: 

Why  is  it  that  Government  ownership  and  management  of  the  telephones  is  practically  always  a 
failure?  Why  is  it  that  for  every  thousand  Europeans  there  is  only  one  telephone,  while  for  every 
thousand  Americans  there  are  fifteen?  Why  is  it  that  the  country  which  has  done  most  to  improve 
the  telephone,  both  technically  and  commercially,  and  to  popularise  its  use  is  the  country  in  which  its 
operation  and  development  have  been,  and  still  are,  exclusively  the  work  of  private  enterprise?  Why 
is  it  that  not  one  of  the  innumerable  discoveries  that  have  transformed  the  telephone  industry  in  the 
last  thirty  years  has  emanated  from  a  Department  of  State,  that  European  Governments  have  been  the 
last  to  adopt  them,  and  that  the  verdict  which  experts  are  obliged  to  pass  upon  them,  with,  perhaps, 
two  partial  exceptions,  is  that  they  have  not  learned  their  business  ?  Why  is  it  that  there  are  great  and 
famous  towns  in  Europe  at  this  moment  where  methods  and  machinery  that  were  abandoned  twenty 
years  ago  in  America  are  still  in  use?  Why  is  it  that  throughout  the  length  and  breadth  of  Great 
Britain  and  the  Continent  hardly  a  single  efficient  long-distance  service  is  to  be  found  ?  Why  is  it  that 
in  New  York  one  can  invariably  get  the  number  one  wants,  and  get  it  at  once,  while  in  London  one 
has  often  to  wage  a  prolonged  and  embittering  battle  with  a  slow  operator,  insufficient  lines,  and  a  con- 
versation— if  any  conversation  ensues — that  is  only  audible  when  it  is  interrupted? 

The  broad  answer  to  all  these  questions  is  that  the  alertness  and  enterprise  that  are  essential  to 
telephone  development  cannot  be  expected  from  a  Government  Department.  The  characteristics  of 
the  bureaucratic  mind  and  temperament  forbid  it.  The  organization  of  a  Government  office,  with  a 
virtually  irremovable  staff,  forbids  it. 

30 


The  Daily  Mail,  London,  England,  December  27,  1913: 

Mr.  Samuel  has  recently  returned  from  a  visit  to  the  United  States  and  Canada.  The  contrast 
between  the  telephone  service  he  encountered  there  and  the  parody  of  it  over  which  he  presides  at 
home  must  have  filled  him  with  mortification.  Nor  can  he  well  have  escaped  realising  that  the  es- 
sence of  a  telephone  system,  and  the  sole  test  by  which  its  value  can  be  judged,  is  its  efficiency ;  that 
it  is  either  efficient  or  it  is  nothing  but  an  exasperating  mockery ;  and  that  a  cheap  service  which  is 
also  unreliable  is  far  more  expensive  than  a  comparatively  dear  service  that  can  always  be  depended 
upon. 

The  Times,  London,  England,  December  3,  1913: 

On  the  other  hand,  the  fact  remains  that  in  America  the  exchanges,  with  practically  the  same 
equipment  as  is  used  in  London,  are  able  to  give  their  subscribers  a  much  more  prompt  and  efficient 
service,  as  a  matter  of  practical  certainty.  The  shortcomings  of  operators  in  this  country  must  not, 
therefore,  be  attributed  entirely  to  the  arduous  and  harassing  nature  of  their  work. 

The  root-fault  appears  to  lie  in  the  system,  in  the  conduct  of  the  telephone  business  by  a  Gov- 
ernment Department  instead  of  by  private  enterprise. 

The  Times,  London,  England,  July  20,  1910: 

In  most  European  countries  the  need  for  rapid  electrical  communication  is  just  as  great  as  it 
is  in  America,  and  were  the  supply  as  efficiently  organized  as  it  is  in  America  there  would  be  almost 
as  great  a  demand  for  the  telephone  service  here  as  there.  The  fact  that  there  is  only  one  European 
telephone  to  ten  American  telephones  must  point  to  some  general  cause  of  slow  or  arrested  develop- 
ment. 

From  the  National  Telephone  Journal,  London,  England,  reprinted  in  the  Financial  Times. 
London,  England,  February  22,  1910: 

In  America,  on  the  one  hand,  the  telephone  service  is  rapidly  being  developed  to  its  utmost 
limits;  in  Europe,  on  the  other  hand,  State-controlled,  the  telephone  system  is  either,  at  best,  moder- 
ately developed,  or  else  absolutely  starved.  There  is  no  doubt  that  in  a  well-organized  company  the 
freer  stimulus  given  to  individual  merit  and  capacity,  and  the  reaction  of  the  latter  both  on  the  quality 
and  earning  power  of  a  service,  benefits  a  far  wider  circle  than  the  shareholders — namely,  the  public 
at  large. 

New  York  Press,  February  15,  1910: 

U.  N.  Bethell,  vice-president  of  the  New  York  Telephone  Company,  has  received  a  letter  from 
M.  Millerand,  Minister  of  Posts  and  Telegraphs  in  France,  asking  if  the  New  York  Company  will 
take  on  six  young  telephone  officials  from  Paris  and  give  to  them  a  thorough  practical  training  in  the 
telephone  business  in  all  its  branches. 

Bulletin  des  Abonnes  au  Tiliphone  (Telephone  Subscribers'  Bulletin),  Paris,  France,  Febru- 
ary, 1909,  p.  3  (Translation)  : 

In  New  York  it  takes  13  seconds  and  a  half  to  obtain  a  local  communication.  In  Paris,  are  we 
assured  of  obtaining  a  local  connection  at  the  expiration  of  13  minutes? 

Telephone  Engineer,  Chicago,  III.,  December,  1913: 

Former  Postmaster-General  James,  a  very  high  authority,  has  never  favored  Government  own- 
ership of  the  telephone  and  telegraph  business.  He  has  gone  so  far  as  to  say  that  were  the  Post  Office 
department  managed  with  the  same  skill,  energy  and  business  capacity  that  characterizes  the  manage- 
ment of  our  great  corporation,  it  would  be  practicable  to  reduce  letter  postage  from  2  cents  to  1  cent 
and  still  leave  a  balance  in  favor  of  the  Government. 

There  is  not  a  particle  of  doubt  that  a  better  mail  service  than  we  now  have  could  be  had  under 
competent  private  management  at  a  cost  at  least  $50,000,000  a  year  less  than  the  people  are  now  pay- 

31 


ing.     Neither  our  Government  nor  any  other,  can  manage  the  telephone  and  telegraph  with  half  the 
economy  and  efficiency  of  private  ownership  and  direction. 

New  York  Press,  December  27,  1913 : 

The  Government  will  owe  a  billion  dollars,  say,  but  for  all  practical  purposes  of  the  Govern- 
ment it  will  be  as  if  the  deficit  didn't  exist.  The  Government  will  have  to  pay  $40,000,000  a  year  in- 
terest, say,  but  for  all  practical  purposes  of  the  Government  it  will  be  just  as  if  it  wasn't  paying  any 
interest  at  all.  The  Government  will  have  to  pay  into  the  sinking  fund  several  more  millions  a  year, 
but  for  all  practical  purposes  of  the  Government  it  will  be  just  as  if  it  weren't  paying  in  a  cent. 

That  is  to  say,  this  will  all  be  so  if  the  Government  can  and  does  operate  the  wire  service  as 
efficiently  and  as  profitably  as  it  is  now  operated.  If  it  doesn't,  of  course,  that  will  be  a  horse  of  a 
different  color.     And  that  is  really  the  whole  question. 

Waterloo,  Iowa,  Reporter,  December  23,  1913: 

When  the  Government  owns  and  operates  the  railroads,  the  telegraphs  and  telephones,  rates 
will  be  much  higher  than  they  are  now  or  else  the  Government  will  become  bankrupt,  as  it  cannot  do 
any  business  as  cheaply  and  efficiently  as  it  would  be  done  under  private  management,  if  interest  on 
bonds  necessary  to  acquire  the  properties  is  taken  into  consideration. 

Philadelphia,  Pa.,  Inquirer,  December  22,  1913: 

Telephone  and  telegraph  companies  are  run  on  a  scientific  basis.  Expenses  are  watched  with 
great  care.  If  anything  goes  wrong  the  remedy  is  promptly  applied.  Could  the  official  red-tape  of 
the  Government  be  relied  upon  to  reduce  the  efficiency  of  the  private  corporation?  We  seriously 
doubt  it.  England  runs  its  telegraph  through  its  Post  Office  Department,  but  financially  it  is  a  great 
loss.  The  deficit  for  forty  years  has  averaged  more  than  $2,000,000  annually.  The  present  deficit  is 
more  than  $3,000,000,  and  the  recently  acquired  telephone  service  is  another  expensive  experiment. 

Albany,  N.  Y.,  Journal,  December  20,  1913 : 

Again  it  is  the  question  of  efficiency  of  service.  Would  efficiency  be  maintained  at  the  stand- 
ard established  by  the  private  corporations  ?  These  have  every  incentive  to  give  the  best  service  pos- 
sible. They  need  all  the  patronage  they  can  obtain,  since  they  are  in  business  for  private  interests. 
The  better  they  satisfy  their  patrons  the  more  business  they  are  likely  to  get.  And  they  know  that 
if  they  fail  in  any  important  particular,  complaints  can  and  will  be  made  to  agencies  of  the  Govern- 
ment. 

New  York  Sun,  December  20,  1913: 

The  Telegraph  and  Telephone  companies  are  among  the  best  administered  institutions  in  the 
world.  Their  systems  are  the  result  of  long  and  sharp  competition  and  the  enlightened  application  of 
the  best  science  and  the  most  expert  energy  to  the  betterment  of  their  systems.  They  are  constantly 
meeting  new  demands  of  the  business  and  they  are  voluntarily  reducing  rates  wherever  business 
permits. 

The  Postal  service — but  perhaps  it  is  better  merely  to  say  that  for  years  to  come  there  will 
be  work  enough  for  the  Government  in  improving  the  machinery  in  its  present  field  of  operation, 
without  undertaking  the  preposterous  and  unnecessary  extension  of  functions  which  Mr.  Burleson's 
annual  report  so  complacently  proposes.       This  is  the  plain  truth  of  the  matter. 

New  York  Press,  December  20,  1913 : 

Whoever  knew  a  Government  building  to  be  constructed  as  quickly,  as  cheaply  and  as  success- 
fully as  a  corporation  or  an  individual  constructs  a  similar  building? 

Whoever  knew  a  Government  service  to  be  performed  with  the  dispatch  and  efficiency  a 
similar  service  is  performed  by  a  private  enterprise? 

Whoever  knew  Government  employees  to  work  the  hours  that  other  men  work? 

Whoever  knew  Government  employees  to  put  into  their  work,  long  hours  or  short  hours,  the 
steam  that  other  men  put  into  theirs? 

32 


Whoever  knew  the  highest  talent  for  organization,  for  administration,  for  business  manage- 
ment, to  seek  Government  jobs? 

All  this  has  a  direct  and  vital  bearing  upon  the  proposal  of  men  close  to  the  administration  to 
put  the  United  States  Government  into  the  telephone  and  telegraph  business. 

Saginaw,  Mich.,  Courier-Herald,  December  19,  1913: 

Government  ownership  works  very  well  in  countries  which  have  a  comparatively  stable  admin- 
istration, in  short  there  are  no  frequent  changes  of  officials  or  reversals  of  policy.  It  is  very  ques- 
tionable just  how  well  it  could  be  expected  to  work  in  a  country  like  our  own  in  which  there  is  likely 
to  be  a  complete  change  of  administration  and  an  entire  overturn  of  Governmental  theories  and  prac- 
tices every  four  years.  A  business  cannot  be  most  successfully  conducted  which  is  likely  to  be  placed 
in  wholly  different  hands  at  short  intervals,  whose  governing  officials  are  likely  to  be  appointed  not 
for  efficiency,  but  for  political  considerations,  are  likely  to  have  had  no  experience  with  the  depart- 
ment in  which  they  are  placed,  and  may  fly  off  on  entirely  new  and  unexpected  tangents. 

IndianapoHs,  Ind.,  News,  December  18,  1913: 

We  know,  as  a  matter  of  fact,  that  Government  management  is  always  more  costly  than  pri- 
vate management — and  usually  far  less  efficient.  In  England  at  the  present  time  there  is  much  com- 
plaint of  bad  telegraph  service.    Even  our  own  postal  service  is  far  from  what  it  ought  to  be. 

The  Times,  London,  England,  December  1,  1913: 

There  is  no  doubt  that  the  superiority  of  the  American  system  has  been  attained  in  a  great 
measure  by  administrative  ability  in  its  organizers  and  the  wide  field  of  opportunity,  with  few  serious 
obstacles  of  competition,  in  which  they  have  worked.  Their  outlook  has  been  steadily  national,  not 
parochial.  They  have  realized  that  defective  telephonic  communication  is,  in  every  sense,  bad  busi- 
ness, and  that  the  factors  constituting  good  service,  in  the  order  of  their  importance,  are  (1)  speed 
and  accuracy  in  securing  connections;  (2)  volume  and  clearness  of  sound  transmitted;  and  (3)  cost. 
They  have  realized  that  the  money  value  of  the  time  and  temper  wasted  by  the  public  over  a  bad 
service  is  a  far  more  serious  consideration  than  any  reasonable  charges  imposed  for  a  good  one,  and 
they  have  therefore  proceeded  on  the  principle  that  speed  and  reliability  are  more  important  than 
cheapness. 

Telephone  Engineer,  Chicago,  111.,  November,  1913: 

Thousands  who  are  responsible  for  good  telephone  service  to-day  have  studied  it  with  intense 
concentration  for  thirty  years.  We  would  respectfully  urge  that  all  politicians  who  contemplate  the 
advocacy  of  Government  ownership  devote  at  least  an  equal  period  of  time  to  its  investigation.  By 
that  time  either  the  political  efficiency  of  the  country  will  be  wondeVfully  changed  or  they  will  have 
decided  that  the  thing  cannot  be  done. 

Boston,  Mass.,  Herald,  November  28,  1913: 

Of  all  the  agencies  under  heavens  among  men  for  conducting  ordinary  business,  the  Govern- 
ment of  the  United  States  is  the  least  efficient.  Its  long  range  of  operations — for  Washington  is  a 
good  ways  off — its  log-rolling  by  Districts  and  States,  its  necessary  subordination  to  the  demands  of 
its  organized  employees,  its  redundant  pay-rolls,  all  spell  inefficiency.  The  general  public  pays  the 
price,  partly  for  the  service  at  the  time  it  is  performed  and  later  in  general  taxation.  This  is  the  way 
it  is  now  paying  for  the  Post  Office  and  for  the  parcel  post  and  for  everything  else. 

Government  ownership  once  secured,  would  mark  the  end  of  improvement  in  the  transmission 
of  intelligence  by  these  two  agencies.  Do  you  realize  how  private  enterprise  would  run  the  light- 
houses? By  an  automatic  arrangement,  just  as  the  electric  street  signs  are  flashed  on  and  off  and 
without  the  need  of  individual  attendance  aside  from  supervisors.  Will  the  Government  ever  do  this? 
Never.    Its  ^im  is  not  to  save  labor,  but  to  make  it.     Is  Congressman  Curley  studying  to  find  ways  of 

33 


reducing  the  pay-rolls  in  the  Charlestown  Navy  Yard?     If  he  were  would  he  remain  Congressman 
long?    *   *   * 

The  visitor  to  the  National  Capitol,  taken  into  the  Bureau  of  Engraving  and  Printing,  will  there 
be  shown  presses  turned  by  human  hands,  with  the  suave  explanation  of  the  Government-paid  atten- 
dant that  the  work  is  of  such  a  delicate  character  that  no  form  of  mechanical  power  can  be  safely  ap- 
plied. This  is  sheerest  humbug!  There  is  not  a  shred  of  engineering  testimony  to  that  effect.  If 
anything,  the  electric  power  of  the  present  day  is  superior  in  uniformity  and  responsiveness  to  any 
that  the  human  arm  can  supply.  This  is  only  one  of  the  countless  devices  for  making  work,  and 
openly  advocated  as  such  by  the  legislative  agent  who  forced  the  requirement  from  a  timid  Congress. 

Springfield,  Mass.,  New  England  Homestead,  October  18,  1913: 

It  took  twenty  years'  persistent  public  effort  to  induce  Congress  to  authorize  parcel  post.  How 
awful  it  would  be  if,  every  time  we  wanted  some  improvement  in  railways,  telephones  or  telegraphs, 
we  had  to  wait  for  Congress  to  grant  it. 

New  York  Times,  October  4,  1913: 

It  is  interesting  to  nofe  that  it  is  always  the  prosperous  private  undertakings  which  the  Gov- 
ernment covets  in  the  interest  of  the  people.  The  Government  never  pioneers  and  develops  and  pro- 
duces profit  where  none  was  before.  The  Government  specialty  is  spending  $2  in  the  place  of  $1, 
and  hiring  two  men  in  the  place  of  one.  It  is  true  that  Government  officials  sometimes  have  delu- 
sions of  grandeur  in  this  respect,  but  the  realization  of  the  dreams  are  subject  to  such  sad  awaken- 
ings as  overtook  the  British  Government's  dabbling  with  wireless  communications. 

Th^  Saturday  Evening  Post,  February  15,  1913: 

The  statement  that  Collector  Loeb,  of  the  port  of  New  York,  will  resign  promptly  on  March 
fourth  is  only  one  among  many  instances  which  remind  us  that  business  wants  able  men,  but  the  Gov- 
ernment does  not. 

We  understand  Mr.  Loeb  has  made  an  exceptionally  good  record  as  collector  of  the  port  of 
New  York.  If  he  had  made  an  exceptionally  good  record  for  the  Steel  Trust  or  a  railroad  or  bank 
the  employer  would  naturally  be  anxious  to  retain  his  services.  To  that  end  it  would  make  him  every 
reasonable  assurance  of  permanent  tenure,  higher  position  and  better  pay — without  inquiring  to  what 
political  party  or  church  he  belonged.  As  an  employee  of  the  United  States  Government  he  might 
have  made  a  record  that  astonished  the  world,  but  the  employer  would  have  no  use  for  him  after 
March  fourth — no  inducement  of  permanent  tenure,  higher  position  and  better  pay  to  offer  him. 

Brooklyn,  N.  Y.,  Life,  February  8,  1913 : 

Professor  Pupin  of  Columbia  recently  took  exception  to  the  casual  remark  of  a  gentleman  who, 
being  asked  what  he  considered  the  three  greatest  institutions  in  the  world,  answered:  the  Roman 
Catholic  Church,  the  German  Army  and  the  Standard  Oil  Company.  Professor  Pupin  told  him  he 
was  right  only  as  to  the  last,  for  the  three  greatest  institutions  in  the  world  were  the  Standard  Oil 
Company,  the  General  Electric  Company  and  the  American  Telephone  and  Telegraph  Company. 
Whether  the  professor  was  right  or  wrong  these  institutions  testify  to  our  organizing  ability  and  if 
our  government  were  run  as  they  are,  Germany  would  be  taking  lessons  from  us  and  one  might  talk 
of  municipally  operated  subways  without  being  popularly  regarded  as  lacking  in  the  upper  story. 

From  an  article  entitled  "The  Government  and  the  Railroads,"  by  Arthur  T.  Hadley,  LL.D., 
President  of  Yale  University,  published  in  Youth's  Companion,  April  18,  1912: 

*  *  *  An  employee  of  the  United  States  Government  feels  less  assured  of  the  permanence  of 
his  position  than  an  employee  of  most  of  our  private  corporations.  He  is  less  certain  that  efficient 
service  will  result  in  promotion,  and  far  more  apprehensive  of  outside  interference  with  his  work  by 
people  who  know  nothing  of  the  real  conditions  under  which  he  labors. 

34 


SERVICE 
(Foreign — Official) 

Extract  from  Minutes  of  Proceedings  of  a  Deputation  from  the  London  Chamber  of  Com- 
merce, which  waited  upon  Postmaster-General  Samuel,  July  4,  1913: 

*  ♦  *  Those  of  us  who  visit  America  are  quite  satisfied  that  the  trunk  (long  distance)  serv- 
ice in  this  country  is  not  in  anything  like  the  shape  of  the  trunk  service  in  the  United  States.  I  do 
not  think  anyone  who  visited  the  United  States  would  say  that  the  trunk  service  here  could  be  com- 
pared with  the  trunk  service  over  there. 

Letter  from  R.  P.  Houston,  M.  P.,  to  Herbert  Samuel,  British  Postmastef-General  (The  Daily 

Mail,  London,  England,  June  13,  1913) : 

H  the  present  chaotic  and  maddening  telephone  service  you  supply  to  the  public  is  to  continue 
I  would  suggest  that  the  Government  provide  special  lunatic  asylums  for  those  subscribers  who  will 
be  driven  mad  by  the  use  of  what  I  believe  to  be  the  most  inefficient  and  exasperating  telephone  serv- 
ice in  the  world. 

British  ParliamenUry  Debates,  Official  Report,  April  24,  1913,  pp.  621-622: 
Mr.  Long  :  *  ♦  *  Since  the  telephone  was  taken  over  by  the  Post  Office  the  actual  service 
has  in  many  cases  not  been  so  good,  and  complaints  have  enormously  increased.  I  speak  as  one  who 
has  used  the  telephone  himself  at  his  own  residences  under  the  National  Telephone  Company  and  to- 
day under  the  Post  Office.  I  have  found  nobody  whose  experience  differs  from  my  own,  and  I  say 
that  there  were  less  complaints  then  than  there  are  now,  that  I  had  less  interruptions  in  the  conversa- 
tions which  took  place,  and  that  the  system  worked  better  and  more  smoothly. 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  p.  594: 

Mr.  Goldman  :  *  *  *  There  is  no  comparison  between  the  trunk  (long  distance)  service 
here  and  that  in  the  United  States.  In  the  United  States  the  trunk  service  is  known  as  a  no-delay  serv- 
ice, while  in  this  country  it  is  known  as  an  all-delay  service. 

Statement  by  C.  S.  Goldman,  M.  P.,  in  an  article  in  The  Daily  Graphic,  London,  England, 
March  3,  1913: 

Our  telephones  may  truly  be  described  as  "the  get-them-when-you-can  service."  This  is  not 
good  enough.  The  post  is  regular.  Deliveries  can  be  relied  upon  to  be  made  at  a  certain  hour ;  even 
telegrams  have  some  certainty  in  time ;  and  when  one  person  at  one  end  of  the  wire  wishes  to  speak 
to  another  person  at  the  other  end  of  that  wire  he  should  be  able  to  do  it  quickly  and  well.  The  tele- 
phone in  this  country  is  a  disappointment  as  a  vehicle  of  efficient  and  reliable  communication. 

From  Parliamentary  Debates,  Official  Report,  Great  Britain,  May  20,  1912: 
Mr.  Baird:  I  wish  to  say  a  few  words  about  the  telephones  in  London.  I  think  the  transfer 
of  the  telephones  to  the  Government  has  been  a  proof  of  the  calamity  of  pushing  upon  the  Govern- 
ment the  control  of  a  monopoly  upon  which  the  comfort  of  the  public  depends.  After  a  considerable 
experience  of  telephones  in  a  great  many  countries,  I  have  no  hesitation  in  saying  that  there  is  noth- 
ing, even  in  Abyssinia,  half  as  bad  as  the  telephone  service  in  London  to-day. 

British  Pariiamentary  Debates,  Official  Report,  May  20,  1912,  p.  1660 : 

Sir  Gilbert  Parker  :  •  •  ♦  that  reform  has  not  been  carried  out  in  the  telephone  system  is 
evident  to  everybody  who  has  suffered  as  I  have  from  morning  until  night,  having  a  good  deal  of 
business  to  do  over  the  telephone  wires.  There  has  been  nothing  said  to-day  in  criticism  of  the  tele- 
phone system  which  is  not  abundantly  justified,  because  if  you  go  to  the  utmost  comers  of  the  world 
you  will  find  a  better  system  in  existence  than  is  to  be  found  in  this  country,  and  particularly  ini 
London. 

35 


The  Daily  Mail,  London,  England,  February  9,  1912: 

Lord  Devonport,  chairman  of  the  Port  of  London  Authority,  wrote  in  The  Times  yesterday  as 
follows : 

"As  Parliament  is  not  at  present  available,  may  I  be  allowed  through  the  publicity  of  your 
columns  to  inquire  of  the  Postmaster-General  on  what  date  he  hopes  to  restore  the  telephone  service 
to  its  normal  state  of  efficiency  and  usefulness?  At  the  moment,  so  far  as  the  Port  Authority  is  con- 
cerned, it  has  ceased  to  be  a  reliable  aid  to  business." 

From  "La  gestion  par  I'Etat  et  les  municipalites"  (State  and  Municipal  Mismanagement),  by 
Yves  Guyot,  Ex-Minister  of  Public  Works,  France,  1913,  pages  349-50  (Translation)  : 

In  1905,  on  returning  from  the  United  States,  I  found  again,  in  Paris,  all  the  charms  of  the 
telephone.  I  rang,  but  it  was  only  at  the  end  of  one  or  two  minutes  that  the  operator  answered.  I 
heard  calls,  other  numbers,  conversations ;  and  I  waited  until  they  were  good  enough  to  say,  "They 
don't  answer," — referring  to  houses  where  employees  are  stationed  at  the  telephone  permanently, — or 
else  the  refrain,  "Line  is  busy,"  which,  of  course,  cannot  be  verified  until  later  on. 

I  took  a  notion  to  complain.  As  a  result,  I  had  to  do  penance  for  a  fortnight.  No  one  could 
get  connection  with  me,  nor  could  I  get  connection  with  anyone  else.  I  felt  that  I  had  earned  a  re- 
ward for  my  patience.  The  Administration,  obsessed  by  this  subscriber  who  complained  so  persist- 
ently, said  to  me  at  last : 

"Come  and  see  the  Gutenberg  exchange." 

I  went  to  see  the  Gutenberg  exchange.  I  spoke  of  the  United  States,  where,  in  New  York, 
even  in  the  busiest  hours,  all  connections  are  made  almost  instantaneously. 

"What  do  you  expect?"  said  the  official  who  accompanied  me,  and  whom  I  met  in  New  York. 
"Those  are  private  companies !" 

From  Official  Report,  by  Senator  Emile  Dupont,  in  the  1912  Budget,  Post  &  Telegraphs,  in 
French  Senate  Document  No.  35,  Appendix  to  Stenographic  Report,  Session  of  January  30,  1912, 
pages  74-75  (Free  Translation) : 

COMPLAINT  OF  THE  BOARD  OF  TRADE  OF  THE  CITY  OF  VALENCIENNES. 

*  *  *  We  are  bound  to  state  that,  at  present,  it  is  useless  to  count  on  the  telephone  as  a  rapid 
means  of  communication  between  Paris  and  our  city.  The  Postal  Administration  has  known  this  fact 
for  several  years.  At  the  end  of  the  year  1908  it  made  arrangements  for  the  construction  of  a  third 
circuit  between  Paris  and  Valenciennes.  The  work  of  line  construction  commenced  at  the  beginning 
of  1909.  At  the  present  moment  it  is  not  yet  finished.  Now  each  time  that  this  subject  is  brought  by 
our  Chamber  of  Commerce  to  the  attention  of  the  Administration  the  answer  is  received  that  opera- 
tions are  continued  without  interruption,  that  they  are  pushed  with  vigor,  but  there  is  no  result.  Now 
what  is  the  need  of  taking  three  years  in  order  to  construct  a  telephone  circuit  of  230  kilometres  (143 
miles)  ?    Isn't  this  disconcerting? 

Statement  of  Deputy  Joseph  Noulens,  Reporter  of  the  Committee  of  the  French  Chamber  of 
Deputies  on  Posts  and  Telegraphs  (as  published  in  Le  Journal,  Paris,  reprinted  in  the  National  Tele- 
phone Journal,  London,  England,  September,  1908,  p.  24)  : 

The  universal  indignation  <iroused  by  the  Paris  telephone  service  is  fully  justified.  Prolonged 
delays  in  answering  calls,  bad  hearing  and  repeated  interruption  of  conversation,  are  the  ordinary  fea- 
tures of  the  Paris  telephone  service,  and  are  daily  endured  by  the  unhappy  subscribers. 

From  the  Report  on  the  French  Budget  for  Posts  and  Telegraphs  for  1907,  by  Deputy  Steeg, 
p.  67  (Translation) : 

The  average  time  for  connecting  two  subscribers  in  Paris  is  1  minute  and  50  seconds,  if  we 
are  to  believe  the  Administration.  In  America,  the  time  that  elapses  between  the  subscriber's  call  and 
the  moment  when  be  obtains  connection  is,  at  most,  16  or  17  seconds.    The  difference  is  appreciable ! 

36 


New  York  Herald,  February  9,  1905 : 

M.  Marcel  Sembat,  who  is  charged  with  the  duty  of  reporting  on  the  estimates  for  this  branch 
of  the  public  service,  remarked  that  in  other  countries,  notably  in  America,  the  telephone  service  is 
more  satisfactory  than  in  France.     He  added: 

"In  America  particularly  it  has  reached  a  degree  of  perfection  that  we  dare  not  even  hope  for 
in  France." 

Proceedings  in  the  Dresden,  Germany,  City  Council  (Translated  from  the  Dresdner  Anzeiger, 
July  5.  1913)  : 

Resolved,  that  the  council  ask  the  executive  board  to  present  to  the  Imperial  Postal  Adminis- 
tration a  petition  for  removal  of  the  shortcomings  in  the  Dresden  telephone  service,  which  are  not 
alone  to  be  explained  by  the  change  to  the  semi-automatic  system. 

Councilman  Kohlmann :  *  *  ♦  It  makes  no  difference  what  the  cause  may  be :  the  present 
condition  is  unbearable.  If,  as  I  have  been  told,  the  threat  to  shut  down  the  telephone  for  months  if 
the  complaints  do  not  stop,  is  true,  even  that  might  be  better  than  having  a  telephone  which  can  be 
used  only  occasionally. 

*  *  *  *  *  *  «  *  *  *  *.* 

Councilman  Kuhn :  Gentlemen !  The  opinion  is  unanimous  that  the  present  condition  of  the 
Dresden  telephone  service  is  unbearable  and  deserving  of  the  severest  criticism.  It  might  seem  that 
Herr  Kohlmann  had  said  enough,  but  I  believe  that  the  arbitrary  way  the  Postal  Administration  has 
dealt  with  the  complaints,  in  view  of  the  scandalous  conditions,  should  make  it  our  duty  to  criticise 
very  sharply. 

Criticism  of  German  Telephone  Service  by  Herr  Haberland,  Deputy,  on  February  18,  1913, 
during  a  debate  in  the  Reichstag: 

The  average  time  to  get  a  connection  (long  distance)  in  Berlin  is  IJ^  hours.  Unless  the  call 
is  classified  as  urgent,  the  connection  takes  several  hours. 

From  an  article  by  A.  Bartolini,  Royal  Commissioner  for  the  Reorganization  of  the  Postal  and 
Telegraph  Service  in  Italy,  published  in  Rivista  delle  Comunicazioni  (official  organ  of  the  Italian  Min- 
istry of  Posts  and  Telegraphs),  October,  1913,  pp.  848-9  (Translation) : 

The  criticisms  directed  against  the  Postal  and  Telegraph  Administration  are  numerous  and 
varied.  To  realize  their  importance,  one  need  only  read  the  political  and  technical  papers  each  day, 
and  keep  track  of  the  proposals  and  suggestions  made  by  the  reporter  for  the  Postal  and  Telegraph 
Budget  each  year. 

•  •*•*♦****** 

All  this  might  be  attributed,  in  large  measure,  to  the  easy  and  quick  susceptibility  of  the  Latin 
and  particularly  of  the  Italian  temperament ;  but  that  is  not  so.  There  still  ring  in  the  ears  of  those 
who  were  members  of  the  Commission  which  investigated  the  postal  and  telegraph  offices  throughout 
the  Kingdom,  the  vehement  invectives  uttered  by  the  Chambers  of  Commerce  of  Genoa,  Turin,  Milan, 
Venice,  Naples,  Palermo,  etc.,  against  the  manner  in  which  the  postal,  telegraph  and  telephone  service 
is  conducted  in  Italy.  These  bodies,  giving  direct  expression  to  the  needs  of  commerce  and  industry, 
said,  in  substance : 

"If  the  State  is  incapable  of  conducting  the  postal  and  telegraph  service  as  it  should  be  con- 
ducted, let  it  be  entrusted  to  us  without  more  ado,  and  we  will  operate  it  directly,  providing  the  neces- 
sary capital  and  adopting  suitable  administrative  and  accounting  methods." 

From  a  pamphlet  printed  in  1910  by  the  Italian  Postal  Telegraph  Clerks'  Association,  Hon. 
Filippo  Turati,  Member  of  Parliament,  Italy,  President  (Translation) : 

The  ^(tel^raph)  service  will  continue  on  its  road  to  ruin,  and  the  country  will  endure  the  losses 

37 


and  the  jests.  The  Ministry  of  the  Post  and  the  Telegraph  will  then  perhaps  decide  to  send  its  tele- 
graphic functionaries  to  Canada  and  Venezuela  in  order  that  they  may  learn  there  the  great  progress 
of  the  science. 

Report  by  United  States  Minister  Charles  J.  Vopicka,  Bukharest,  Roumania,  printed  in  Daily 
Consular  &  Trade  Reports,  January  9,  1914 : 

The  Director  of  Posts  and  Telephones  has  issued  a  statement  to  the  effect  that  a  direct  wire  is 
now  open  between  the  cities  of  Bukharest  and  Vienna.  Until  further  notice  only  one  city  in  this 
country  will  be  able  to  have  direct  telephone  communication  with  Vienna,  Cernovitcz,  Lemberg,  and 
Cracovia.  The  telephone  rate  for  three  minutes  between  Bukharest  and  Cernovitcz  will  be  3.50  francs 
(68  cents)  ;  between  Bukharest  and  Lemberg,  4.50  francs  (87  cents)  ;  between  Bukharest  and  Cra- 
covia, 5.50  francs  ($1.06)  ;  between  Bukharest  and  Vienna,  6.50  francs  ($1.25).  In  the  event  of  a 
demand  for  the  quickest  possible  connection,  the  regular  rate  is  tripled. 

(Foreign — Editorial) 

The  Daily  Mail,  London,  England,  December  27,  1913 : 

Since  the  Government  took  over  the  working  of  the  lines  and  public  interest  in  the  efficiency  of 
telephonic  communication  became  proportionately  vigilant,  a  catalogue  of  errors  and  misdemeanors 
has  been  compiled  that  would  have  driven  any  private  company  out  of  business. 

Article  by  Charles  Brunning,  in  the  Liverpool,  England,  Evening  Express  (reprinted  in  the 
Boston,  Mass.,  Herald,  July  26,  1913 : 

Foreigners  mistake  the  excellence  and  quickness  of  the  American  system  for  hustle.  The  Amer- 
ican does  things  more  easily  than  we  do.  In  the  first  place  he  doesn't  write  so  many  letters — he  simply 
telephones. 

And  here  let  me  voice  my  admiration  of  that  wonderful  institution,  the  American  telephone. 
"Wiretalking"  in  America  is  all  done  so  quietly,  so  comfortably,  so  easily,  so  surely — either  local  or 
long  distance — that  one  wonders  how  a  civilized  people  like  we  are  presumed  to  be  can  stand  our 
ridiculous  English  telephone  system.     Truly  we  are  a  long  suffering  people. 

Rarely  does  an  American  shout  in  his  telephone.  He  speaks  in  a  soft,  easy  voice,  for  all  the 
world  like  a  man  saying  his  prayers  in  church. 

Pall  Mall  Gazette,  London,  England,  December  11,  1913: 

In  the  closing  days  of  that  corporation  the  service  was  notoriously  defective :  an  out-going  ten- 
ant cannot  be  expected  to  show  much  zeal  for  improvements.  But  since  the  new  management  came 
in,  bad  has  gone  to  worse,  and  dissatisfaction  is  more  emphatic  and  general  to-day  than  at  any  time 
since  the  invention  was  introduced  to  this  country.  Mr.  Samuel  asks  further  indulgence,  but  we  are 
entitled  to  have  a  time-limit  set  to  the  invocation  of  the  old  familiar  excuses  and  extenuations.  The 
present  state  of  matters  is  a  handicap  on  every  kind  of  national  interest.  All  foreigners  confess  that 
until  they  tried  to  use  our  telephones  they  had  never  realized  the  self-abnegation  and  moral  loftiness 
of  the  British  character. 

From  a  letter  to  the  London,  England,  Times,  December  9,  1913,  by  Sir  Francis  Trippel: 

Sir : — In  a  large  nursing  home  in  Fitzroy-square,  where  30  patients  are  lying  more  or  less  ser- 
iously ill,  the  telephone  got  out  of  order  about  6  p.  m.  on  Saturday.  Every  effort  was  made  by  the 
lady  superintendent  to  have  the  matter  put  right,  but  the  telephone  officials  said  that  nothing  could  be 
done  on  a  Saturday  night  or  Sunday.  Repeated  applications  were  unavailing,  and  the  nursing  home 
remained  cut  off  from  telephonic  communication  during  Saturday  night  and  all  day  and  night  yester- 
day. *  *  *  It  was  not  till  after  40  hours'  interrupted  service  that  the  telephone  was  in  order  again, 
and  it  required  only  a  couple  of  screws  to  be  fixed  in  the  receiver — a  few  minutes'  work. 

Now,  Sir,  this  disgraceful  state  of  organization  in  the  telephone  service  must  cease  to  exist. 
When  it  may  be  a  question  of  life  or  death  at  any  moment,  the  public  has  a  right  to  demand  that 

38 


instant  provision  should  be  made  for  such  an  occurrence  never  to  happen  again  between  Saturday 
night  and  Monday  morning,  and,  if  left  undone,  the  responsible  authorities  lay  themselves  open  to  a 
charge  of  criminal  neglect.  Yours  faithfully, 

Qaridge's  Hotel,  Dec.  8.  Francis  Trippel. 

Metropolitan  Magazine,  New  York,  August,  1913: 

The  telephone,  for  instance ;  if  you  want  a  nice  test  of  temper,  try  to  get  a  number  at  the  Hotel 
Cecil  in  London;  or,  better  still,  spend  a  happy  morning  in  ringing  up  people  on  the  telephone  in 
Paris.  In  .America  it  is  either  done  for  you  at  once  or  you  know  it  cannot  be  done,  and  the  matter  is 
settled. 

The  Standard,  London,  England,  August  13,  1913: 

As  an  instance  of  the  delay  and  muddle  of  the  State  telephone  system  nothing  has  yet  surpassed 
the  treatment  by  the  authorities  of  a  Birmingham  correspondent,  who  has  vainly  sought  to  be  connected 
since  November  last.  The  Post  Office  actually  suggested  that  he  had  better  move  to  another  house, 
so  that  his  request  could  be  the  more  easily  complied  with. 

New  York  Times,  August  10,  1913: 

A  subscriber  writes  to  the  (London)  Daily  Mail,  telling  this  story: 

Sir :  I  have  found  that  numbers  of  f ripnds  who  have  tried  to  ring  me  up  have  always  been  in- 
formed that  no  reply  could  be  obtained.  On  one  or  two  occasions  my  bell  rang,  and  when  I  put  the 
receiver  to  my  ear  I  could  distinctly  hear  the  operator  saying  "No  reply"  or  "Engaged"  to  the  person 
who  was  trying  to  ring  me  up. 

I  determined  to  test  this,  and,  leaving  my  secretary  one  morning  with  the  telephone  in  front  of 
her,  went  out  to  a  call  office  near.  I  asked  for  my  own  number,  and,  after  waiting  three  minutes,  was 
informed  that  the  operator  could  get  no  reply.  I  asked  her  to  try  again,  and,  after  wating  five  min- 
utes, was  informed  there  was  no  reply.  I  then  repeated  the  number  and  asked  her  to  try  once  again, 
and  in  about  half  a  moment  the  engaged  signal  began  to  go.  I  waited  until  this  buzzing  had  ended, 
and  then  I  said  to  the  operator : 

"I  think  it  is  only  right  to  tell  you  that  it  is  my  own  number  I  am  trying  to  ring  up  from  a  call 
office  just  outside  my  flat,  and  my  secretary  is  sitting  waiting  for  this  call." 

I  was  put  through  immediately,  and  my  secretary  informed  me  that  she  had  not  moved  away 
from  the  telephone,  and  no  bell  had  rung. 

Electrical  Industries,  London,  England,  December  4,  1912 : 

There  is  a  certain  amount  of  satisfaction  in  the  fact  that  Mr.  Winston  Qiurchill  got  so  angry 
over  the  freaks  of  the  telephone  the  other  day  that  he  flung  his  receiver  on  the  floor.  As  a  member 
of  the  Government  which  purchased  the  telephone  system,  he  deserves  all  the  torture  that  Post  Office 
working  can  inflict.  But  his  rage,  and  the  delicate  remonstrance  which  he  doubtless  addressed  to  his 
right  honorable  colleague  on  the  subject  do  not,  unfortunately,  make  the  organization  any  better  for 
the  average  subscriber. 

London,  England,  Globe,  September  12,  1912: 

Apparently,  the  Postmaster-General  is  of  the  opinion  that  a  policy  of  masterly  inactivity  will 
eventually  force  the  public,  in  sheer  despair,  to  cease  from  grumbling,  and  give  the  telephone  author- 
ities some  rest.  If  that  is  his  belief,  we  can  only  say  that  he  is  mistaken.  We  English  are  a  patient 
race,  but  we  do  not  intend  to  put  up  with  the  worst  telephone  service  in  the  world  forever. 

The  Standard,  London,  England,  January  2,  1914  (Letter  from  its  Paris  Correspondent) : 

I  went  to  the  Bourse  Centrale  soon  after  eleven  the  other  night  and  found  one  employee  busy 

in  taking  down  applications  for  calls  from  a  crowd  of  impatient  journalists  and  men  of  business  of 

all  nationalities.    From  time  to  time  he  would  shout  out  a  name,  "Popolo,"  "Secolo,"  "Tribuna,"  and 

a  joyful  Italian  would  spring  forward  and  be  allotted  one  of  the  nine  cabins.    His  joy  was  premature, 

39 


apparently,  however,  for  during  the  next  few  minutes  a  string  of  stentorian  complaints  echoed  from 
within,  "Nome  di  Dio !  Rispondete !  Dunque !  Non  mi  intendete !  Santissima  Virgo !"  Then  would 
come  a  Berlin  line  open,  and  a  repetition  ^in  German  of  "Donnerwetter !     Scandal,  Gotteswill !"  etc. 

Through  all  this  the  weary  operator  imperturbably  sat  on,  impervious  to  objurgations  and  en- 
treaties. There  was  a  short  circuit  somewhere,  and  it  was  no  use  swearing  at  him.  In  pity  I  asked 
him  how  long  he  was  expected  to  stand  this  work.  "I  come  in  at  nine  in  the  evening  and  stay  till  eight 
in  the  morning,"  was  the  reply.  One  wretched  man  for  eleven  hours  to  meet  the  whole  interprovin- 
cial  and  international  telephonic  requirements  of  Paris! 

Springfield,  Mass.,  Union,  September  23,  1913 : 

It  is  a  sad  commentary  on  the  French  telephone  service  that  Aviator  Gilbert  on  Sunday  flew 
100  miles  from  Paris  to  Reims  in  55  minutes,  and  that  he  arrived  at  his  destination  before  news  of 
his  departure  could  be  telephoned. 

Le  Temps,  Paris,  France,  August  31,  1913: 

To-day  our  colleague,  "L'Auto,"  protests  against  the  difficulties  which  assail  one  when  one 
wants  to  use  the  telegraph  or  telephone. 

"A  telegram  which  was  handed  in,  in  Deauville,  the  28th  of  August  at  9.15  p.  m.,"  says  our 
confrere,  "was  received  in  the  office  of  'L'Auto'  the  next  morning,  August  29,  at  2  o'clock. 

"A  telegram  which  was  handed  in,  in  Leipzig,  the  28th  of  August  at  9.30  p.  m.,  reached  the 
office  of  'L'Auto'  the  next  morning,  August  29,  at  6  o'clock. 

"As  for  the  telephone,  it  is  no  better:  Of  the  15  cities  constituting  the  relay  points  for  the 
bicyclists'  tour  of  France,  we  were  able  to  get  telephone  communication  with  only  five  or  six.  The 
exchanges  answered  regularly:  'Such  and  such  city  *  *  *  line  out  of  order,'  'Such  and  such  a  city 
"^     *     *     line  out  of  order!'" 

"Those  lines  which  we-  had  taken  the  trouble  to  have  reserved  for  June  12  for  our  interurban 
conversations,  were  not  actually  free  until  the  latter  half  of  July:  the  Tour  of  France,  by  that  time, 
was  two-thirds  accomplished!" 

Article  by  C.  F.  Bertelli,  of  Paris,  in  Leslie's  Weekly,  May  15,  1913:  * 

What  would  the  New  Yorkers  who  grumble  at  a  few  seconds'  wait  do  if  they  were  at  the 
mercies  of  the  Administration  des  Postes  Telegraphes  et  Telephones,  or  "P.  T.  T.,"  as  it  is  familiarly 
called?  An  authoritative  series  of  tests  carried  out  a  short  time  ago  showed  that  the  Paris  system  is 
at  least  seven  and  a  half  times  slower  than  the  American !  Whereas  the  average  time  required  to  get 
into  communication  in  New  York  is,  according  to  latest  figures,  eleven  seconds  (beaten  by  several 
other  cities  in  New  York  State),  the  French  capital  is  content  to  wait  1  minute,  20.8  seconds!  The 
tests  were  perfectly  fair,  being  made  at  the  time  of  day  when  there  is  least  rush.  They  were  made 
from  all  parts  of  the  city,  and  from  all  sorts  of  places — post-offices,  private  apartments,  hotels,  busi- 
ness offices,  cafes,  etc.,  and  the  greatest  possible  variety  of  subscribers  were  rung  up. 

Letter  from  a  French  telephone  subscriber  to  Le  Petit  Phare  de  Nantes,  reprinted  in  the 
Bulletin  de  1' Association  des  Abonnes  au  Telephone,  Paris,  France,  September,  1912  (translation) : 

Sir: — In  one  of  your  recent  issues  of  the  Phare,  mention  was  made  of  the  protest  of  a  sub' 
scriber,  who,  having  asked  for  connection  with  Rennes,  was  informed  that  he  must  wait  eleven  hours 
in  order  to  obtain  it.     This  record  seemed  unbeatable,  and  justly  so. 

But  to-day  I  found  I  had  to  talk  with  Saint-Malo,  and,  wishing  to  be  put  through  quickly,  I  had 
my  name  inscribed  on  the  waiting  list  first  thing  in  the  morning;  the  operator  told  me — though  very 
amiably,  I  must  confess — that  I  would  have  to  wait  thirteen  hours  and  ten  minutes  (you  are  reading 
it  right)  in  order  to  be  put  through. 

Zeitschrift  fiir  Schwachstromtechnik,  Munich,  Germany,  September,  1913  (translation)  : 
In  an  earlier  issue  we  reported  the  stormy  scenes  which  the  disturbances  in  the  Dresden  tele- 
phone service  occasioned  in  the  Dresden  council  meetings.    These  disturbances  have  been  manifest  for 

40 


several  months,  beginning  with  the  installation  of  the  semi-automatic  system,  and  have  made  the  tele- 
phone practically  useless  for  a  large  number  of  the  subscribers.  This  disorder  has  increased  to  such 
a  degree,  and  has  lasted  so  long,  that  many  subscribers  have  decided  to  refuse  to  pay  their  telephone 
bills.    This  will  probably  give  rise  to  more  or  less  activity  in  the  courts. 

Article  by  Dr.  R.  Luther,  Head  Professor  at  the  Dresden  Technische  Hochschule,  in  the  Dres- 
den, Germany,  Anzeiger,  June  28,  1913  (translation)  : 

It  is  an  irony  of  fate  that  the  American  engineers  who  came  to  study  our  "model  technical 
works"  should  have  visited  us  just  at  the  time  of  this  telephone  aparchy.  When  they  get  home,  these 
gentlemen  can  relate,  with  pitying  superiority,  that  in  the  year  1913,  thirty-six  years  after  the  dis- 
covery of  the  electro-magnetic  telephone,  in  the  age  of  the  beginning  of  wireless  telegraphy,  one  of 
the  largest  cities  of  Germany,  Dresden,  with  over  half  a  million  inhabitants,  is  without  adequate  tele- 
phone facilities. 

New  York  Times,  May  5,  1913: 

Berlin,  May  4. — Remarkable  evidence  as  to  the  effect  of  the  telephone  upon  the  minds  of 
people  using  it  was  given  in  a  trial  yesterday.  Dr.  Strauch,  a  commissioner  in  lunacy,  said  that  even 
phlegmatic  men  might  have  their  mental  balance  upset  by  exasperation  at  getting  no  reply  from  "Cen- 
tral." He  mentioned  the  case  of  one  of  his  own  patients,  a  well-known  doctor,  who  became  completely 
insane  through  telephone  exasperation. 

Dr.  Paechter,  another  witness,  asserted  that  he  could  bring  evidence  to  show  that  Government 
telephone  girls  had  been  permitted  by  the  inspectors  to  utilize  one  of  the  big  exchanges  for  the  recep- 
tion of  their  fiances.  One  amusement  of  the  girls  of  this  exchange  was  to  look  up  all  subscribers 
having  the  same  name,  to  connect  all  of  them,  ring  them  all  up,  and  laugh  loudly  at  the  result. 

New  York  rim^j,  September  18,  1912: 

Berlin,  Sept.  17. — Three  engineering  officials  of  the  German  Post  Office  Department  are  about 
to  sail  for  the  United  States  in  order  to  investigate  American  telephone  systems.  *  ♦  *  Ameri- 
can telephones  are  regarded  in  Germany  as  the  best  in  the  world,  and  the  hopes  and  prayers  of  busi- 
ness men  and  householders  accompany  the  Post  Office  Department's  Commissioners  to  America. 

Mattino,  Naples,  Italy,  November  6,  1910  (translation)  : 

At  a  meeting  of  the  Chamber  of  Commerce  on  November  4,  1910,  the  President,  referring  to 
the  Royal  Commission  appointed  to  investigate  the  complaints  of  the  telegraph,  postal  and  telephone 
services,  stated  that  he  had  brought  to  their  attention  the  great  delays  in  the  delivery  of  telegrams 
and  the  execrable  telephone  service,  and  that  he  was  obliged  to  say  that,  since  the  Government  had 
taken  over  the  telephone  company,  the  service  was  far  worse  in  every  respect,  and  that  he  had  taken 
steps  to  send  a  full  report  to  the  Commission. 

From  I'ltalie,  Rome,  Italy,  November  5,  1910  (translation)  : 

Meetings  have  been  held  at  the  various  chambers  of  commerce  throughout  Italy,  but  it  seems 
that  nothing  is  done  to  remedy  the  existing  state  of  aflfairs,  and  every  one  is  complaining  of  the  utter 
impossibility  of  relying  upon  the  telegraph  service. 

From  I'ltalie,  Rome,  Italy,  November  5,  1910  (translation) : 

A  telegram  sent  from  Paris  yesterday,  at  2.37  p.  m.,  was  received  in  Rome  at  8.20  p.  m. 

Six  hours  for  transmission! 

And  this  telegram  was  not  given  a  messenger  until  9  p.  m. 

Forty  minutes  for  it  to  pass  from  the  receiving  room  into  the  pocket  of  the  messenger  I 

This  message  was  very  urgent,  and  asked  that  certain  documents  be  sent  off  at  once  by  mail. 
As  the  mail  train  starts  for  France  at  8.40  p.  m.,  it  was,  of  course,  impossible  for  the  recipient,  a 
reporter,  to  do  as  requested,  and  this  delay  caused  serious  inconvenience. 

♦  •,♦*«»**»**♦ 

41 


The  Italian  Telegraph  administration  takes  undue  advantage  of  the  fact  that  the  Government 
incurs  no  legal  responsibility  for  the  telegraph  service ! 

From  the  Die  Zeit,  Vienna,  Austria,  reprinted  in  the  Elektrotechnische  Zeitschrift,  Berlin,  Ger- 
many, April  24,  1913  (translation)  : 

For  some  time,  it  has  been  difficult  to  connect  new  telephones  in  the  Vienna  Exchange.  The 
Postal  Administration  has  several  thousand  unfilled  applications,  some  of  which  have  been  put  aside 
for  years,  and  it  cannot  be  expected  that  these  applications  will  be  filled  for  some  time.  This  state  of 
affairs  exists  in  almost  every  part  of  Vienna;  in  some  parts  construction  work  has  been  entirely  sus- 
pended, in  others  it  is  only  carried  on  in  a  desultory  manner.  *  *  *  xhe  dissatisfaction  among 
Vienna  subscribers,  and  among  those  who  might  become  subscribers,  is  very  great. 

New  York  Press,  December  23,  1913: 

When  anybody  on  one  side  or  the  other  of  this  debate  talks  rates  and  costs,  they  ought  to  be 
careful  to  make  it  clear  what  service  is  given  the  public,  for  the  cost  in  each  case  and  what  the  rela- 
tive rate  is.  Mr.  Lewis  must  know,  for  example,  that  when  you  hand  in  an  ordinary  telegraph  message 
in  virtually  any  Government  office  on  the  whole  continent  of  Europe  your  message  may  go  through  in 
forty-eight  hours ;  it  may  by  accident  go  through  in  thirty-six  hours ;  it  may  by  a  miracle  go  through 
in  twenty-four  hours;  but  if  you  want  to  get  it  through  in  a  few  hours  you  have  to  pay  double  and 
even  triple  rates. 

The  Government  service  in  France,  Germany,  Italy,  and  Switzerland  did  not  make  any  pretense 
of  getting  an  ordinary  telegraph  message  through — even  short  distances — within  many,  many  hours  of 
the  time  you  can  flash  an  ordinary  message  in  this  country  from  one  side  of  the  continent  to  the  other 
and  have  an  answer  back  on  top  of  it. 


RATES 

{Foreign — Official) 

From  the  Minutes  of  Proceedings  of  a  Deputation  from  the  London  Chamber  of  Commerce 
which  waited  upon  the  Right  Hon.  Herbert  Samuel,  M.  P.,  Postmaster-General  of  Great  Britain,  July 
4.  1913 : 

Mr.  Faithfull  Begg  ;  *  *  *  There  is  one  other  very  important  point  to  which  I  am  asked 
to  refer  and  that  is  the  question  of  the  rates  themselves.  Now  at  the  time  of  the  transfer  I  think  it 
may  be  fairly  said  that  specific  assurances  were  given  or  general  assurances  that  the  result  of  the  taking 
over  by  the  Post  Office  would  not  be  anything  in  the  nature  of  a  general  advance  in  rates,  and  I  think 
the  public,  rightly  or  wrongly,  concluded  that  as  a  matter  of  fact  they  would  get  their  telephones  for 
less.  I  never  shared  that  view,  but  I  think  it  was  a  more  or  less  general  view,  and  we  are  told — and 
I  think  there  is  evidence  throughout  the  country — that  there  are  very  serious  complaints  of  increases 
in  rates.  *  *  *  Generally  speaking,  the  Committee  is  of  opinion  that  it  can  be  shown  that  the 
changes  which  have  taken  place  have  in  the  main  been  in  the  direction  of  a  considerable  increase 
in  rates. 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  page  594: 

Mr.  Goldman  ;  *  *  *  The  Postmaster-General  himself  has  stated  that  he  would  give  us  ser- 
vice equal  to  that  of  the  United  States,  if  we  were  prepared  to  pay  rates  such  as  they  are  paying, 
say,  between  Liverpool  and  London,  a  rate  of  5s.  instead  of  the  existing  rate  of  2s.  6d.  The  Post- 
master General  should  not  forget  that  2s.  6d.  in  this  country  is  almost  equivalent  to  5s.  in  America. 
*  *  *  I  only  want  to  point  out  to  the  Postmaster-General  himself,  who  wanted  to  make  out  that 
he  could  give  us  an  equivalent  service  if  we  were  ready  to  pay  5s.  instead  of  2s.  6d.,  which  we  are 

42 


paying  now,  that,  wages  being  three  times  as  high  in  the  United  States  and  the  money  not  going  as 
far  as  in  this  country,  we  ought  to  get  at  least  as  good  a  service  for  2s.  6d.  as  they  get  for  5s. 

British  ParHamentary  Debates,  Official  Report,  April  24,  1913,  page  576: 

Mr.  Herbert  Samuel:  *  *  *  The  time  is  approaching  for  a  revision  of  the  telephone  rates 
of  charge.  That  is  essential  in  view  of  the  inequalities  of  charge  between  subscribers  in  the  various 
districts. 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  p.  591 : 

Mr.  Goldman:  *  *  *  The  questiqp  which  the  Postmaster-General  raised  with  regard  to 
rates  will  only  be  received  in  this  House  and  outside  with  modified  satisfaction.  He  is  only  able  to 
promise  that  he  hopes  in  the  future  to  be  able  to  deal  with  the  rates,  which  he  ought  to  have  dealt 
with  at  least  two  years  ago. 

*  *  *  The  Postmaster-General  has  acknowledged  the  urgency  of  dealing  with  these  rates, 
because,  in  reply  to  a  speech  of  my  hon.  Friend  the  Member  for  Devizes,  he  stated  (hat  the  efficiency 
of  the  telephone  service,  and  its  development  and  extension,  largely  depended  upon  fixing  the  revision 
of  the  rates,  and  the  delay  in  the  development  and  improvement  which  a  large  number  of  subscribers 
are  suffering  from  to-day  owing  to  unfair  rates,  which  he  himself  acknowledges,  is  largely  due  to 
delay  on  the  part  of  the  Post  Office  in  dealing  with  the  question  of  rates. 

British  Parliamentary  Debates,  Official  Report,  May  20,  1912,  p.  1566: 

Mr.  Herbert  Samuel  (Postmaster-General)  :  •  *  *  I  am  considering  the  introduction  of 
a  system  of  urgent  telegrams  at  triple  rates  between  this  country  and  the  Continent  of  Europe. 

British  Pariiamentary  Debates,  Official  Report,  May  20,  1912,  p.  1584: 

Mr.  C.  S.  Goldman:  *  *  *  Although  the  system  may  be  more  expensive  in  this  country 
than  in  Germany,  I  do  not  believe  that  people  mind  spending  more  money  if  the  system  is  satisfac- 
tory, but  they  object  to  paying  these  high  rates  for  an  unsatisfactory  system,  because  no  one  can  be 
satisfied  when  they  have  to  wait  half  an  hour  or  even  an  hour  before  they  can  get  a  connection. 

British  Pariiamentary  Debates,  Official  Report,  May  20,  1912,  p.  1586: 

Mr.  C.  S.  Goldman  :  *  *  •  Perhaps  the  most  controversial  point  in  connection  with  tele- 
phones is  that  which  refers  to  rates.  This  question  has  also  been  the  subject  of  much  discussion. 
The  Postmaster-General  will  remember  that  only  last  year  he  received  a  big  deputation  from  over  one 
hundred  municipalities  in  England  urging  him  to  deal  with  this  question  of  the  rates.     *     *     * 

Report  on  the  French  Budget  for  Posts  &  Telegraphs,  1911,  by  M.  Charles  Dumont,  Deputy 
(translation)  : 

Finally,  telephone  service  in  Paris  is  subjected  to  all  the  inconveniences  of  a  flat  rate: — a  high 
subscription  which  deprives  small  and  medium  sized  merchants  from  competing  with  more  wealthy 
concerns — subscribers  whose  lines  are  occupied  almost  continuously  (cafes,  restaurants,  etc.),  and  who, 
for  the  sum  of  400  francs,  cause  the  Administration  a  hundred  times  more  work  than  an  ordinary  sub- 
scriber— the  difficulty  in  putting  through  calls  on  the  lines  of  these  subscribers,  which  are  almost 
always  occupied,  and,  consequently,  repeated  losses  of  time  for  the  operators — finally  useless  conver- 
sations, babbling  and  gossiping  by  telephone,  which  even  the  smallest  message  rate  would  discourage. 

From  the  letter  of  the  Belgian  Minister  of  Railways,  Posts  &  Telegraphs,  transmitting  to  the 
King  a  draft  of  the  law  providing  for  the  abolition  of  flat  rates,  and  the  adoption  of  measured  rates, 
published  in  Le  Moniteur  Beige,  Brussels,  September  16,  1911  (translation): 

The  system  known  as  the  flat  rate  system,  at  present  in  effect  in  our  country,  has  gradually  been 
abolished  by  foreign  countries;  it  has  been  considered  irrational  and  unjust,  .and  as  forming  the 
greatest  obstacle  to  the  popularization  of  the  telephone. 

43 


British  Parliamentary  Debates,  Official  Report,  June  19,  1911,  p.  85: 

Mr.  Morton  ;  *  *  *  There  is  a  general  feeling  that  the  cost  of  using  the  telephone  might 
be  considerably  reduced. 

British  Parliamentary  Debates,  Official  Report,  June  19,  1911,  p.  54: 

Mr.  Herbert  Samuel  ;  *  *  *  i  am,  however,  now  being  pressed  to  promise  immediate  reduc- 
tions in  the  existing  telephone  rates,  and  those  who  complain  that  the  Post  Office  is  not  to  be  trusted  to 
manage  the  telephones  in  a  business-like  way  because  it  is  too  much  open  to  pressure  are  often  themselves 
the  first  to  bring  political  and  other  pressure  to  bear  in  order  to  secure  an  immediate  reduction  to  rates 
which  might  be  to  unremunerative  amounts. 

From  the  Report  of  the  Royal  Commission  Appointed  to  Investigate  the  Postal,  Telegraph  and 
Telephone  Services  of  the  Commonwealth  of  Australia  (ordered  to  be  printed  October  5,  1910)  : 

?p'po"sed°by  32.     *    *     *    The  evideucc  disclosed  that  the  reductions  in  the  telephone  rates 

fndThw'  ^^^^       were  made  on  the  advice  of  a  subordinate  officer,  and  in  opposition  to  the  advice  of 
Electrical  Engineer,    j^g  Permanent  Head  and  Chief  Electrical   Engineer,  and  your   Commissioners   con- 
sider that  the  then  Postmaster-General  took  action  without  having  any  sound  reason 
for  the  drastic  reduction  made. 


Ses"^'°"  ^^  '°  ^^^-     T^^^^  section  of  the  Report  will  be  confined  to  the  telephone  rates  and 

charges  imposed  upon  the  public  during  the  period  of  Federation.  The  evidence  dis- 
closed considerable  confusion  as  to  the  basis  of  the  charges  to  be  adopted.  Your  Com- 
missioners are  of  the  opinion  that  the  present  charges  are  grossly  inequitable  to 
certain  sections  of  the  public. 


wft'hourfuu'**'*''  ^^-     From  the  evidence,  your  Commissioners  are  forced  to  conclude  that  these 

consideration.  rates  were  established  without  full  consideration  of  the  ultimate  result,  and  a  total 

disregard  of  the  experience  of  other  countries. 

From  the  Report  of  the  Royal  Commission,  appointed  July  10,  1910,  to  investigate  the  telephone 
service  in  Italy  (translation)  : 

The  present  rates  are  not  proportionate  to  the  expenses  caused  by  the  various  classes  of  sub- 
scribers, and,  thus,  those  who  reap  the  least  profit  suffer  the  most,  and  those  to  whom  the  service  is 
of  greater  advantage  pay  the  least. 

Statement  in  the  German  Reichstag,  April  16,  1910,  by  the  Secretary  of  State  for  the  Post 
Office,  Published  in  the  Deutsche  Verkehrszeitung,  Berlin,  Germany,  April  22,  1910  (translation)  : 

*  *  *  I  am  well  aware  that  during  the  first  deliberation  of  the  proposed  rate  law  various 
objections  were  raised  by  members  of  the  House  against  the  rate  law.    *    *    * 

The  renewed  presentation  of  the  rate  law  has  led  to  many  harsh  criticisms  in  the  dailies. 

Report  on  the  French  Budget  for  Posts  &  Telegraphs,  1909,  by  M.  Chautard,  Deputy  (trans- 
lation) : 

The  flat  rate  system,  which  is  in  effect  in  the  larger  cities  of  France,  precludes  a  good  service, 
whatever  the  excellence  of  the  personnel  and  the  equipment  may  be;  this  is  to-day  the  unanimous 
opinion  of  engineers  and  telephone  managers  in  every  country,  and  it  is  an  opinion  definitely  and 
scientifically  established,  because  it  is  based  on  very  wide  telephone  experience. 

44 


Elektrotechinsche  Zeitschrift,  Berlin,  Germany,  December  16,  1909  (translation) : 
A  commission  of  the  Hansa-Bund,  brought  together   from  all   circles  of   German  trades  and 
industries  for  consideration  of  the  proposed  changes  in  the  Telephone  Rate  Law,  has  unanimously 
voted  the  following  resolution,  which  is  to  be  sent  to  the  legislative  authorities : — 

"The  telephone  ought  to  be  a  tool  for  daily  use,  yet  in  Germany,  as  opposed  to  other  coun- 
tries, especially  Sweden,  it  has  not  obtained  the  popularity  and  usefulness  due  it,  chiefly  because 
its  use  heretofore  has  been  much  too  costly  for  large  circles  of  business,  particularly  for  the  mid- 
dle-sized and  small  trades  and  industries,  as  well  as  for  officers  and  householders. 

"Consequently,  we  regard  the  proposed  increase  in  cost  of  this  indispensable  and  yet  tech- 
nically imperfected  means  of  communication  as  a  measure  which  must  injure  not  only  these  wide 
circles  of  the  people,  but  also  the  Government  Postal  Department  itself.  We  are  of  the  opinion 
that  the  surplus  expected  from  this  increase  in  rates  would  be  obtained  sooner  by  a  reduction 
than  by  an  increase,  and  that  the  urgent  popularization  of  the  telephone  can  be  attained  by  a  gen- 
eral cheap  base  rate  and  a  measured  conversation  tax,  which  would  be  established  not  by  individual 
count,  but  by  blocks,  and  which  could  eventually  be  graded  according  to  use." 

Abstract  from  Debate  in  the  Reichstag,  Germany,  March  3,  1909,  published  in  Archiv  fur  Post 
&  Tetegraphie,  Berlin,  April,  1909   (translation) : 

The  Secretary  of  State  for  the  Post  Office:  *  ♦  *  It  is  well  known  to  you  that  soon 
after  the  introduction  of  the  Telephone  Rate  Order  the  desire  arose  to  obtain  a  greater  equalization.. 


The  new  rate  order  was  arrived  at  as  a  result  of  experience  and  the  demands  of  the  House. 
They  were  carefully  considered  in  conference  with  the  South  German  Postal  Government.  After 
conclusions  had  been  made,  the  chief  commercial  associations  were  asked  to  name  a  number  of  men 
whom  they  considered  competent  to  advise  the  Government  in  this  matter.  The  plan  was  submitted 
to  these  men  for  advice  and  suggestions,  and  a  majority  of  them  supported  the  new  schedule.  The 
objection  all  came  from  the  smaller  class  which  will  suffer  disadvantage  from  the  new  order ;  but  they 
only  amount  to  about  30  or  35  per  cent.,  and  the  rest  of  the  people  are  pleased  with  it.     *     *     * 

The  objection  is  made  that  we  pay  the  operators  and  general  personnel  too  little ;  and  that  the 
hours  are  too  long.  But  where  is  the  money  coming  from,  especially  when  there  is  a  constant  cry 
for  reduced  rates! 

From  the  Report  on  the  French  Budget  for  Posts  and  Telegraphs  for  1905,  by  M.  Marcel  Sem- 
bat,  p.  61  (translation) : 

Moreover  the  high  subscription  rate,  400  francs,  prevents  a  great  number  of  little  shop  keepers 
and  little  business  men  from  having  the  telephone. 

{Foreiffn — Editorial) 

Liverpool,  England,  Daily  Post  and  Mercury,  October  29,  1913: 

Mr.  Ogilvie's  speech  to  the  Advisory  Committee  aflords  rather  cold  comfort  to  those  of  us  who 
have  been  hoping  that  under  Government  control  telephone  rates  would  be  materially  reduced.  We 
seem  to  remember  that  another  distinguished  official  expert  more  than  once  declared  that  the  ambi- 
tion of  the  Department  was  to  lay  on  the  telephone  like  gas  and  water  into  every  house,  and  that  this 
could  not  be  done  unless  the  existing  charges  were  brought  down  by  a  large  amount.  Instead  of  this, 
we  have  the  Secretary  to  the  Post  Office,  one  of  the  most  progressive  and  enterprising  officials  in  the 
service,  telling  us  that  he  does  not  anticipate  any  immediate  increase  of  rates,  but  that  "it  will  be  almost 
impossible  to  have  a  permanent  rate  for  telephone  service,  and  rates  will  have  to  be  reviewed  from  time 
to  time."  Furthermore:  "The  authorities  are  not  very  sanguine  that  much  of  a  reduction  in  the 
rates  will  be  possible."  This  certainly  is  not  what  the  public  expected  when  the  Government  took  over 
the  service.    It  was  felt  that  charges  which  enabled  the  old  company  to  pay  a  good  dividend,  and  a 

45 


very  big  royalty  to  the  State,  ought  to  be  capable  of  reduction  under  Government  administration  when 
those  items  were  abolished. 

From  an  article  entitled  "Public  Ownership  in  France,"  by  Paul  Leroy-Beaulieu,  in  the  North 
American  Review,  March,  1913. 

It  is  not  superfluous  to  say  here  a  few  words  about  one  of  the  more  recent  French  State  monop- 
oHes — the  telephone.  The  complaints  under  this  head  are  universal.  In  the  first  place,  the  tariff  is 
very  high — 400  francs,  or  nearly  $80  a  year  in  Paris,  the  aim  of  the  State  being  to  get  out  of  it  as 
much  as  possible — 40,000,000  francs  gross. 

Winnipeg,  Manitoba,   Tribune,  December  29,  191 1 : 

The  Tribune  learned  this  afternoon  that  strong  and  probably  effective  pressure  of  a  party  polit- 
ical nature  is  being  brought  to  bear  on  the  Local  Government  to  suspend  the  proposed  new  telephone 
schedule,  and  substitute  one  that  will  be  within  a  measure  of  reason.  *  *  *  ^(-  ^^y  rate,  the 
Tribune  is  assured  that  the  new  rates  will  not  prevail,  for  the  simple  reason  that  the  public  will  not 
stand  for  them.     *     *     * 

Winnipeg,  Manitoba,  Free  Press,  December  28,  1911: 

At  the  annual  meeting  of  the  Winnipeg  Builders'  Exchange  last  night  the  following  resolution 
was  passed  unanimously: 

"Resolved,  that  the  Winnipeg  Builders'  Exchange,  at  this  annual  meeting,  do  hereby  emphat- 
ically protest  against  the  proposed  increase  in  the  schedule  of  telephone  rates  in  this  city,  believing 
the  same  to  be  excessive  and  unjust,  and  further  affirms  that  in  its  opinion  no  increase  in  the  rates 
should  be  proposed  until  a  full  statement  in  detail  of  the  cost  of  the  system,  and  of  operating  the  same, 
has  been  placed  before  the  people,  who  are  the  owners  of  the  property,  and  that  such  statement  should 
show  the  cost  and  the  expense  of  operating  that  portion  within  the  city  of  Winnipeg,  and  the  revenue 
derived  therefrom." 

Winnipeg,  Manitoba,  Free  Press,  December  22,  1911: 

The  medical  men  say  they  are  out  to  beat  the  proposals  of  the  government  in  the  matter  of 
telephone  rates.  One  of  their  number  states  that  a  meeting  of  the  practitioners  in  the  city  will  be 
held  at  an  early  date,  and  the  whole  matter  brought  up  for  consideration  and  action. 

Winnipeg,  Manitoba,  Free  Press,  December  20,  1911: 

The  storm  of  protest  against  the  Manitoba  Government  telephone  new  rates  is  now  taking 
more  material  form,  and  the  various  bodies  of  business  men  who  are  organized  in  the  city  are  taking 
the  matter  up  in  public,  and  moving  in  the  direction  of  having  the  rates  repealed. 

At  the  same  time  the  protests  continue  from  every  quarter  of  the  city  and  the  province. 
Every  shade  of  political  opinion  and  every  class  of  society  is  represented  by  the  subscribers,  who 
feel  that  the  new  rates  are  an  injustice  to  those  who  have  patronized  the  telephone  system  for  so  long. 

Winnipeg,  Manitoba,  Free  Press,  December  14,  1911: 

Many  have  said  that  under  the  new  schedule  they  will  have  to  do  without  the  'phone.  Others 
have  suggested  a  boycott.  One  prominent  man  of  business  says  that  the  subscribers  in  the  city 
should  band  together  and  abolish  the  'phone,  thus  meeting  the  authorities  on  their  own  ground.  They 
have  not  been  consulted  regarding  the  change,  and  it  is  simply  outrageous.  Another  says,  "The  post- 
card is  cheaper  and  will  serve  my  purpose  as  well." 

And  not  only  is  the  denunciation  of  the  rates  confined  to  the  small  householders  or  the  small 
business  men  of  the  city.  The  leading  men  of  the  city  are  out  against  the  proposed  rates.  The 
Board  of  Trade  will  take  the  matter  up  at  its  next  meeting.  It  will  be  considered  by  the  Builders' 
Exchange,  and  a  committee  of  the  Industrial  Bureau  has  been  appointed  to  take  the  matter  up.  It 
is  not,  therefore,  the  cry  of  one  single  class  or  section  of  the  community  that  is  heard,  but  the  uni- 
versal voice  of  the  community. 

46 


Winnipeg,  Manitoba,  Free  Press,  December  14,  1911: 

Yesterday  the  Manitoba  Telephone  Commission  issued  a  statement  of  the  new  telephone  rates. 
*  *  *  The  new  schedule  which  is  announced  makes  a  number  of  changes  which  are  of  importance 
and  the  cost  of  the  telephone  in  the  house  and  the  office  will  be  materially  increased. 

A  number  of  business  men  in  the  city  who  had  gone  into  the  rates  as  announced  are  strong  in 
the  condemnation  of  them,  and  say  that  many  of  their  customers  will  as  a  result  of  the  changes 
dispense  with  the  telephone,  and  as  a  consequence  business  will  suffer  greatly.  A  storm  of  protest  has 
come  from  private  telephone  users  all  over  the  city. 

Zeitschrift  fur  Schwachstromtechnik,  Munich,  Germany,  October,  1911,  No.  20: 
The  Guild  of  Trade  Agents  in  Prague  has  begun  energetic  agitation  against  the  increases  in 
the  telephone  rates  which  are  to  take  effect  in  Prague  on  January  1st  of  next  year.    A  petition,  with 
reasons  fully  explained,  will  be  presented  shortly  by  this  Guild  to  the  Minister  of  Commerce  at 
Vienna. 

Blatter  fir  Post  und  TeUgraphie,  Berlin,  Germany,  October  15,  1911  (translation)  : 
The  new  Telephone  Rate  Law,  which  according  to  the  plan  of  the  Government  was  to  have 
gone  into  effect  on  April  1,  1911,  is  at  the  present  moment  still  being  discussed  in  committee — a  proof 
of  what  vast  importance  the  proposal  must  be  for  almost  everyone,  and  an  evidence  of  the  widely  varied 
convictions  of  the  different  parties  in  the  Reichstag.  The  proposed  law  received — almost  without 
exception — an  unfavorable  reception  in  the  daily  press;  however,  it  must  be  noted  that  only  the 
sentiments  of  those  received  expression  who — rightly  or  wrongly — thought  their  own  rates  would  be 
increased,  so  that  the  public  press  cannot  be  considered  as  the  true  reflection  of  public  opinion. 

Elecktrotechnische  Zeitschrift,  Berlin,  Germany,  February  9,  1911   (translation): 
During  the  first  meeting  of  the  Executive  Committee  of  the  Berlin  Trade  and  Industrial  Asso- 
ciation, January,  1911,  the  new  telephone  rates  were  discussed,  and  after  deliberation  the  members 
voted  to  oppose  the  Government's  proposition.     According  to  the  views  of  the  Committee,  these 
rates  do  not  meet  the  wants  of  commerce  and  industry. 

Statement  by  Leon  Gerard  before  the  Chamber  of  Commerce,  Brussels,  Belgium,  published 
in  the  Bulletin  of  the  Chamber,  January  15,  1911  (translation)  : 

We  have  learned  that  the  government  has  planned  to  modify  telephone  subscription  rates.  The 
plan  which  it  proposes  to  adopt  has  caused  great  protest,  and  we  have  thought  it  necessary  to  call  at 
once  a  meeting  of  the  Executive  Committee,  in  order  to  deliberate  without  delay  upon  this  question. 


For  several  years,  Belgium's  trade  and  commerce  have  raised  complaints  both  about  the  organi- 
zation of  the  telephone  service  and  about  the  height  of  the  telephone  rates.  These  complaints,  set 
aside  for  a  long  time  by  every  possible  dilatory  means,  have  finally  succeeded  in  causing  the  admin- 
istration to  elaborate  a  new  tariff  schedule. 

The  first  glance  at  this  tariff  schedule  has  been  sufficient,  because  of  the  rate  increases  which  it 
necessitates,  to  cause  outcries  of  public  opinion. 

Elecktrotechnische  Zeitschrift.  Berlin,  Germany,  January  5,  1911  (translation): 
With  regard  to  the  attacks  which  the  new  rate  schedule  of  the  Administration  has  occasioned 
in  trade  circles,  the  matter  has  been  submitted  to  expert  opinion  by  the  Board  of  Trade  in  addition  to 
the  Chamber  of  Commerce  of  Vienna.  At  the  recent  meeting  representatives  of  the  Government 
were  also  present.  The  management  of  the  entire  telephone  system  was  discussed,  and  it  was  urged 
that   operation   be  carried   on  on   a  more  commercial   basis  than    formerly.     *     ♦     * 

*  *  *  The  meeting  reached  the  decision  that  the  Department  of  Commerce  be  requested 
to  remodel  the  rate  schedule  and  in  doing  so  to  have  regard  to  the  points  recommended  by  the  Board 
of  Trade. 

47 


The  Frankfurter  Zeitung,  Frankfort,  Germany,  June  2,  1909  (translation)  : 
At  the  end  of  1907  a  committee  of  representatives  of  the  three  German  Postal  Administrations 
met  and  agreed  on  a  bill  for  the  new  regulation  of  the  German  telephone  rates — apparently  on  the 
proposal  of  the  Bavarian  Government.  This  bill,  in  January,  1908,  was  placed  before  a  committee 
of  the  different  circles  interested,  called  together  y  the  German  Post  Office,  and,  after  lengthy  con- 
sideration, was  practically  declared  to  be  acceptable.  But  when  the  bill  with  the  supplementary  memo- 
randum was  made  public,  general  opposition  arose  and  fifteen  months  of  most  vigorous  discussion 
followed.  On  the  10th  of  February,  1909,  the  bill  and  memorandum  were  placed  unaltered  before 
the  German  Reichstag,  and  at  the  present  time  the  bill  is  resting  in  Committee. 

It  will  be  seen  that  the  injustices  of  the  proposed  tariff  are  quite  of  the  magnitude  of  those 
of  the  existing  tariff. 

(Note. — Agitation  for  a  revision  of  rates  began  in  1906.  The  Government  immediately  rec- 
ognized the  need  for  a  general  rate  revision,  and  has  since  then  been  planning  the  revision.  Latest 
advices  show  that  no  action  has  as  yet  been  secured  during  the  eight  years  of  rate  planning.) 

(American— Editorial) 

From  "Alaska— An  Empire  in  the  Making"  (1913,  Chapter  XVI,  pages  205-7),  by  John  J. 
Underwood.  (The  information  contained  in  this  book  was  gathered  during  an  almost  continuous  resi- 
dence of  fourteen  years  in  Alaska  and  the  Yukon  Territory)  : 

There  is  at  present  one  good  example  of  government  ownership  in  Alaska  in  the  telegraph  sys- 
tem of  the  Territory,  which  is  owned  and  operated  exclusively  by  the  government  under  the  direction 
of  the  Department  of  War.  The  tolls  charged  on  this  system  are  such  as  would  force  a  private  cor- 
poration to  keep  a  hydrant  playing  on  its  stock  books  to  keep  down  the  dividends  to  a  point  where 
they  would  not  create  a  public  scandal. 

3|E  3|E  3|«  3|G  ^  J|G  j|C  3|C  3^  3|C  ^  ^ 

Mile  for  mile  the  government  charges  at  least  280  per  cent,  more  for  service  in  Alaska  than 
does  either  of  the  large  companies  operating  in  the  United  States. 

The  rate  charged  for  a  message  of  ten  words  from  Seattle  to  Nome,  a  distance  of  2,340  miles 
by  steamship  course  and  2,879  miles  by  the  telegraph  and  cable  route,  is  $3.80  and  thirty-eight  cents 
for  each  extra  word.  The  rate  charged  by  either  of  the  commercial  companies  for  a  ten-word  day 
message  from  Seattle  to  New  York,  a  distance  of  3,000  miles,  is  $1.00,  and  seven  cents  for  each  addi- 
tional word.  The  rate  for  telegraph  and  cable  messages  from  Seattle  to  London  or  Berlin,  a  distance 
more  than  twice  as  great  as  that  from  Seattle  to  Nome,  is  $2.90.  Messages  between  points  in  the 
United  States  are  transmitted  on  about  an  equal  mileage  basis. 

New  York  Press,  December  22,  1913: 

To  find  the  exact  relationship  between  British  and  American  charges  for  telephone  service  will 
require  scientific  investigation  into  all  those  conditions,  with  technical  adjustments  to  make  true  com- 
parisons and  expert  measurements  of  what  really  comes  out  as  service  for  what  really  goes  in  as  cost. 
Meanwhile,  we  do  know  positively  that,  whatever  the  actual  cost  comparison,  we  have  something  over 
here  worth,  in  what  it  does  for  us,  a  very  great  deal  more  than  the  British  service  is  worth. 

As  for  the  French  telephone  service,  it  is  both  poor  and  dear.  It  is  so  wretchedly  poor  that 
nobody  in  Paris,  for  example,  will  have  a  telephone  in  the  house  if  he  can  possibly  do  without  it.  It 
is  both  so  low  in  efficiency  and  high  in  cost — for  what  is  done — that  Paris  doesn't  make  the  relative 
telephone  showing  of  an  ordinary  American  village.  Technical  measurements  of  those  facts  also 
must  be  forthcoming  before  any  final  judgment  of  the  true  balance  will  be  reached. 


48 


EXPENSE 
(Foreign — Official) 

From  the  Report  of  the  British  Postmaster-General  for  the  year  1912-13,  p.  34.  No  allowance 
has  been  made  for:  (a)  Interest  on  capital  invested  since  September  30,  1873;  (b)  Depreciation; 
(c)  Interest  on  accumulated  deficits.  "No  rent  is  charged  in  respect  of  premises  owned  by  the 
Postmaster-General  and  used   for  the  purposes  of   Telegraph  business." — Official  Report. 

Telegraphs. — The  telegraph  revenue  of  the  year,  including  the  value  of  services  rendered 
to  other  Departments,  was  £3,167,410,  an  increase  of  £19,705 ;  and  the  telegraph  expenditure,  includ- 
ing the  interest  on  the  capital — £10,867,644 — expended  on  the  purchase  of  the  telegraphs,  was  £4,124,- 
976,  a  decrease  of  £309,897  upon  the  previous  year.  The  net  deficit  was  thus  £957,566,  or  £329,602 
less  than  last  year. 

Financial  results  of  the  combined  telegraph  and  telephone  toll  service  in  New  Zealand,  for  the 
year  ended  March  31,  1913,  as  published  in  the  Official  Report  of  the  Post  and  Telegraph  Depart- 
ment : 

i  $ 
Gross  Telegraph  and  Telephone  Toll  Revenue  (including  Miscellaneous  Rev- 
enue)          321,951       1,564.682 

Value  of  Government  Messages 4,931  23,965 

Totol  Value  of  Telegraph  and  Telephone  Toll  Business 326.882       1,588,647 

Total  Tel^raph  and  Telephone  Toll  Expenditure  (excluding  interest  charges)       388.464       1,887,935 
Official  Net  Profit  (excluding  interest  charges)  of  the  Combined  Telegraph  and 

Telephone  Toll  Services —61,582     —299,288 

From  telegraph  statistics  for  Spain,  for  1911.  published  in  Le  Journal  Teligraphique,  Berne. 
Switzerland  (official  organ  of  the  International  Bureau  of  the  Telegraph  Union).  May  25,  1913  (trans- 
lation) : 

Total  receipts  Fr.    10,622,159     ($2,124,432) 

"     expenses Fr.    12,153.718     ($2,430,743) 

Deficit Fr.      1,531,559     ($   306,311) 

From  telegraph  statistics  for  the  Union  of  South  Africa,  for  1911,  published  in  Le  Journal 
Tiligraphique,  Berne,  Switzerland  (official  organ  of  the  International  Bureau  of  the  Telegraph  Union), 
May  25,  1913.    (Telegraphs  in  the  Union  of  South  Africa  are  State  owned)  : 

Total  receipts  Fr.   8,271,900     ($1,654,380) 

"      expenses Fr.   9.530.588     ($1,906,118.) 

Deficit Fr.    1,258,688     ($   251.738) 

From  the  Official  Report  of  the  Minister  of  Public  Instruction,  Post  and  Telegraphs,  Ecuador, 
for  the  year  1911-1912,  p.  26  (translation)  : 

To  be  perfectly  candid,  I  can  do  no  less  than  state  in  this  report  that  the  accounting  of  the 
telegraph  branch  still  suffers  from  "routine-ism"  and  really  woeful  inefficiency.  And  without  proper 
accounting,  it  is  difficult  to  exercise  any  control,  or  to  make  just  criticism.  The  result  is,  that  in  a 
service  whose  income  should  suffice  to  meet  its  needs  and  to  yield  an  assured  profit  to  the  exchequer, 
there  occurs,  year  after  year,  a  greater  and  greater  deficit,  as  can  be  proved  by  simply  making  a 
comparative  analysis  of  figures  and  dates. 

49 


Limiting  myself  to  the  year  with  which  this    report  is  concerned,  the  financial  standing  of  the 
telegraphs  for  the  last  six  months  of  1911  was,  approximately,  as  follows: 

Receipts   SI.  169,586.62     ($  82,588.68) 

Expenditures SI.  230,486.17     ($112,246.76) 


Deficit SI.    60,899.55     ($  29,658.08) 

In  the  first  six  months  of  this  year  the  revenue  and  expend-tures  were  as  follows: 

Receipts   SI.  139,804.63     ($  68,084.85) 

Expenditures SI.  221,650.28     ($107,943.68) 


Deficit SI.    81,845.65     ($  39,858.83) 

Financial  results  of  the  combined  telegraph  and  telephone  toll  service  in  New  Zealand,  1907-08 
to  1911-12,  inclusive,  as  published  in  the  Official  Reports  of  the  Post  and  Telegraph  Department: 


Year 
ended 
March  31, 


1908. 
1909. 
1910., 
1911., 
1912. , 


Gross  Tele- 
graph and 
Telephone 
Toll  Revenue 
(incL  Miscellan- 
eous Revenue.) 

i 

227,398 
238,104 
250,212 
272,943 
295,334 


Value  of 

Government 

Messages. 


i 

4,499 
4,821 
4,851 
4,874 
4,832 


Total  Value 
of  Telegraph 
and  Telephone 
Toll  Business. 


i 

231,897 
242,925 
255,063 
277,%\7 
300,166 


Totals  1,283,991 


23,877 


1,307,868 


Total  Telegraph 
and  Telephone 
Toll  Expenditure, 
including  charges. 

Official  Net  Profit  (excluding 
interest  charges)  of  the  Com- 
bined   Telegraph   and    Tele- 
phone Toll  Services. 

i 

i 

$ 

275,757 

—43,860 

—213,160 

307,166 

—64,241 

—312,211 

322,485 

—67,422 

—327,671 

344,046 

—66,229 

—321,873 

364,613 

—64,447 

—313,212 

1,614,067 

—306,199 

—1,488,127 

Statement  of  Herr  Reinhold  Kraetke  (Postmaster-General  of  the  German  Imperial  Postal  Ser- 
vice, including  the  Telegraph  and  Telephone  services)  made  in  the  course  of  a  debate  in  the  Reich- 
stag on  March  27,  1912  (published  in  the  Deutsche  Verkehrszeitung,  April  5,  1912)  : 

The  gentlemen  know  that  the  Telegraph  Administration  is  run  at  a  very  heavy  loss. 

From  the  Report  on  the  French  Budget  for  Posts  and  Telegraphs,  1911,  by  M.  Emile  Dupont, 
Senator,  Senate  Document  No.  189,  p.  117  (translation) : 

The  consequence  is  that,  taking  everything  into  account,  the  operation  of  the  telegraphs  results 
in  a  deficit.  *  *  *  in  his  Supplementary  Report  on  the  Budget  for  Posts  and  Telegraphs  for 
1905,  Hon.  M.  Sembat  tried  to  draw  up  a  balance  sheet  for  the  three  great  branches  of  the  service. 
With  definite  reservations,  he  indicates  a  deficit  of  9,777,000  fr.  ($1,886,961)  for  the  telegraphs. 

From  the  Official  Report  of  the  Postmaster-General  of  the  Union  of  South  Africa  (Department 
of  Posts  and  Telegraphs),  for  the  year  1911  (p.  12) : 

After  debiting  the  telegraph  account  with  all  direct  charges  incurred  and  a  proportionate  share 
of  the  cost  of  administration  and  other  general  expenditure,  and,  on  the  credit  side,  including  the 
value  of  work  undertaken  free  of  charge  for  other  Government  Departments  and  of  the  concession 
represented  by  the  reduced  rates  to  the  Railway,  it  is  found  that  the  working  of  the  Telegraphs  of  the 
Union  resulted  in  a  deficit  for  the  year  of  over  £60,000. 

From  the  Report  of  the  Postmaster-General  of  the  Union  of  South  Africa,  for  the  year  1910: 

Although  every  effort  has  been  made  to  reduce  expenditure,   there  is   little  prospect  of   the 

Telegraph  Department  paying  its  way.     The  Reports  of  all  the  Provinces  prior  to  Union   showed 

losses  in  working,  the  amount  in  the  Cape  Colony  and  Transvaal  being  at  the  rate  of  £37,000  and 

£34,052  per  annum  respectively. 


50 


The  general  position  of  the  Telephone  Account  of  the  Union  for  the  calendar  year  1910,  was: 

Capital  Expenditure £893,239 

Revenue.  1910 167,271 

Expenditure,  1910,  including  interest  and  depreciation 189,049 

Deficit 21,778 

From  the  Annual  Report  on  the  Postal,  Telegraph  and  Telephone  Service  of  The  Netherlands 
for  the  year  1910: 

Total  Telegraph  Revenue Fl.  2,543,679  ($1 ,017,472) 

Total  telegraph  Expenditure Fl.  4,180,227  ($1,672,091) 

Deficit Fl.  1,636,548  ($   654,619) 

From  the  Report  of  the  Royal  Commission  Appointed  to  Investigate  the  Postal,  Telegraph  and 
Telephone  Services  of  the  Commonwealth  of  Australia  (ordered  to  be  printed  October  5,  1910)  : 

Accepting  the  most  liberal  reading  *  ♦  *  the  estimated  loss  on  the  transactions  of  the  Depart- 
ment from  the  inception  of  the  Commonwealth  to  30th  June,  1909,  amounted  to  at  least  £2,300,000. 

*  *  *  *  *  *  *.«  «  *  *  « 

The  information  furnished  would  make  it  appear  certain  that  the  postal  section  of  the  Depart- 
ment returns  a  profit  as  a  whole  but  the  extent  of  such  profit  was  not  ascertainable.    *    *    * 

Your  Commissioners  therefore  conclude  that  the  Department's  unsound  financial  position  is 
due  to  the  fact  that  telegraphic  and  telephonic  services  are  rendered  at  rates  which  do  not  return  rev- 
enue sufficient  to  cover  all  charges  against  capital  account,  and  working  expenses. 

From  report  of  a  speech  of  Representative  Dr.  Paasche  in  the  German  Reichstag,  February 
15,  1901,  as  given  in  the  Archiv  fur  Post  und  Telegraphie  (an  official  publication),  for  April,  1901 
(translation)  : 

In  accordance  with  information  furnished  by  the  Secretary  of  State  of  the  Imperial  Post  Office, 
an  attempt  has  been  made  to  estimate  the  financial  result  of  some  branches  of  the  Postal  Administra- 
tion, by  applying  ordinary  commercial  principles.  Using  correct  rates  for  depreciation,  and  a  proper 
interest  upon  the  capital  invested  in  the  telegraph,  it  appears  that  this  service  requires  annually  a  con- 
tribution of  15,000,000  marks,  being,  therefore,  a  losing  business. 

From  a  speech  delivered  at  Tourcoing,  France,  November  17,  1913,  by  the  Marquis  de  Monte- 
bello,  President  of  the  Association  of  Telephone  Subscribers,  printed  in  the  Bulletin  des  Abonnes  au 
Telephone  (Bulletin  of  the  Telephone  Subscribers'  Association),  Paris,  France,  December,  -1913 
(translation) : 

The  State  in  France  has  not  even  a  proper  accounting  system  for  the  telephone.  It  does  not 
know  whether  the  telephone  yields  a  profit  or  whether  there  is  a  loss.  A  senator  has  calculated  that 
the  State  probably  loses  about  eight  millions  each  year. 

(Foreign — Editorial) 

Teltgraph  and  Telephone  Age,  New  York,  February  16,  1912,  page  121,  quoting  from  the 
London  Spectator,  in  regard  to  the  British  telegraph  service: 

When  all  these  facts  are  taken  into  account — namely,  the  original  capital  which  has  never  been 
repaid,  the  advances  from  Parliament  upon  which  no  interest  is  charged,  and  the  annual  deficiencies 
on  working  expenses — it  will  be  found  that  the  aggregate  commercial  loss  to  the  country  by  the  state 
purchase  of  the  telegraphs  is  not  less  than  $175,000,000.  Nor  can  we  console  ourselves  with  the  re- 
flection that  for  this  $175,000,000  the  state  has  a  valuable  asset,  for  that  asset,  such  as  it  is,  involves 
every  year  on  its  working  an  additional  loss  of  over  $5,000,000.  From  a  commercial  point  of  view 
the  purchase  ha^  been  an  unmitigated  failure. 

51 


Boston,  Mass.,  Transcript,  December  22,  1913: 

It  is  to  be  hoped  that  such  gayety  will  not  become  contagious,  for  if  it  does  there  is  no  saying 
how  soon  we  shall  be  imitating  the  example  of  AustraHa,  which  in  its  zeal  for  public  ownership  has 
accumulated  a  bonded  debt  fully  fifty  per  cent  greater  than  the  United  States.  This  may  seem  a  start- 
ling statement  to  make  with  regard  to  a  commonwealth  which  has  less  than  5,000,000  inhabitants,  but 
figures  bear  it  out.  The  total  public  debt  of  the  States  composing  the  Commonwealth  of  Australia 
was:  June  30,  1912,  about  $3,365,000,000,  or,  deducting  the  sinking  fund,  $1,335,000,000.  This  was 
accumulated  through  government  ownership,  and  represents  bond  issues  for  the  State  railroads  and 
State  proprietorship  of  public  utilities  generally.  The  railroads,  all  of  which  are  State  owned,  cost  for 
construction  and  equipment  $766,000,000,  though  they  have  a  mileage  of  but  16,078  in  operation.  Their 
gross  receipts  are  about  $89,000,000  a  year,  their  operating  expenses  about  $56,000,000.  Inasmuch  as 
the  population  of  the  United  States  is  about  twenty  times  that  of  Australia  and  our  railroads  have 
250,000  mileage,  it  will  not  require  a  very  elaborate  calculation  to  reach  what  would  be  the  cost  if  we 
should  imitate  Australia. 

Providence,  R.  I.,  Journal,  December  15,  1913: 

The  assumption  of  Senator  Hoke  Smith,  of  Georgia,  that  "the  profits  will  ultimately  pay  back 
the  original  cost,"  is  not  warranted  by  the  experiences  of  other  countries  with  the  telegraph  and  tele- 
phone. In  1869  the  British  Parliament  thought  that  in  fifteen  years  the  profits  of  the  telegraph  would 
wipe  out  the  cost  and  that  large  sums  would  be  available  from  them  for  "the  relief  of  taxes." 

The  companies  were  paying  6%  dividend,  which  disappeared  when  the  government  took  the 
properties.  In  two  years  losses  were  reported  and  the  deficit,  according  to  the  report  of  the  Post- 
master-General, now  exceeds  $4,500,000  annually.  And  this  does  not  include  the  loss  of  interest  on 
the  original  investment  and  on  the  money  put  into  extensions,  which,  it  is  estimated,  brings  the  total 
loss  up  to  $6,000,000  a  year. 

There  was  a  like  experience  when  the  Government  acquired  the  telephone,  the  result  has  been 
that  the  service  has  deteriorated ;  that  no  profit  is  shown  and  that  the  Government  employes  are  most 
arbitrary  in  their  demands.  As  these  employes  have  votes  they  are  in  a  position  to  obtain  concessions 
from  the  Government  which  are  not  justified  on  business  principles.  Presumably  the  American  labor 
unions  would  not  overlook  the  opportunities  offered  by  political  control  of  the  long  distance  telephone 
field,  and  under  their  domination  neither  cost  of  operation  nor  standards  of  efficiency  would  be  con- 
sidered. 

(American — Official) 

Statement  by  George  French,  author  and  editor,  in  a  letter  to  the  New  York  Times,  dated 
October  10,  1913,  and  published  October  13,  1913: 

It  happened  a  few  years  ago,  during  the  reign  of  Roosevelt,  that  I  was  commissioned  to  ex- 
amine the  Government  Printing  Office,  as  an  expert  in  printing  and  economics.  The  work  was  done 
for  a  Senate  committee  that  was  then  looking  into  expenditures.  About  the  first  thing  that  happened 
to  me  was  symptomatic  of  the  Washington  atmosphere.  I  asked  an  attendant  in  one  of  the  Senate 
offices  for  a  glass  of  water.  The  man  looked  at  me  with  surprise  written  all  over  his  face.  Recover- 
ing himself,  he  said,  "Water?  Why  do  you  wish  to  drink  water?  Look  here."  Then  he  showed  me 
a  closet  full  of  all  kinds  of  mineral  waters,  beer,  and  sundry  other  beverages,  in  distinguished  looking 
bottles.  "The  Government  pays  for  it.  Drink  whatever  you  like,  and  if  your  special  drink  is  not 
there  I  will  send  out  and  get  it."  It  was  not  easy  to  get  cool  water  in  the  building — just  plain  water. 
It  was  too  inexpensive.    And  the  Government  pays  for  something  better,  or  at  least  more  costly. 

From  Report  of  W.  S.  Bissell,  Postmaster-General  of  the  United  States,  year  1894,  pp.  48-49: 
It  would  seem  that  a  comparatively  small  country,  territorially,  like  Great  Britain,  with  its  large 
population,  great  commercial  interests,  and  distribution  of  cities,  would  furnish  as  favorable  condi- 
tions for  the  operation  of  a  successful  governmental  telegraph  system  as  any  in  the  world ;  yet  the 
report  of  the  British  Post  Office  Department  to  the  House  of  Commons,  dated  November  27,  1893, 

52 


shows  the  cost  of  the  plant,  up  to  the  end  of  the  fiscal  year  1893,  to  have  been  $52,930,388.  Interest 
upon  this  amount,  at  the  rate  of  2^%  per  annum,  is  charged  in  the  current  account  and  amounts  to 
$1,455,584. 

In  the  operation  of  the  service  there  was  a  further  loss  of  $811,741,  so  that  the  total  deficit 
for  the  year  amounted  to  $2,267,325.  The  deficiencies  have  been  continuous  since  1876,  and  have 
a^r^ated,  since  1872,  $24,005,432,  and  in  the  last  ten  years  the  average  deficiency  has  been  nearly 
$1700,000.  In  Great  Britain  the  postal  service  proper  yields  a  large  revenue  to  the  Government,  and 
so.  in  one  sense,  it  can  be  said  that  it  can  afford  the  luxury  of  a  postal  telegraph.  Under  our  postal 
system,  however,  partly  undeveloped  as  it  still  remains,  a  telegraph  system  would  be  operated  at  a 
great  loss  to  the  Government ;  and  this  burden,  it  seems  to  me,  should  not  be  added  to  the  Post  Office 
Department. 

If  the  establishment  of  a  tel^^ph  plant  in  a  compact  country  like  Great  Britain  would  cost 
over  $52,000,000,  what  would  be  the  cost  of  establishing  a  plant  for  this  country?  I  will  not  stop  to 
make  a  computation,  but  one  can  see  at  a  glance  that  the  cost  would  be  many  times  that  of  the  British 
plant,  and  the  annual  interest  charged  many  times  $1,455,584;  and  if  the  loss  in  operation  were  over 
$800,000  in  that  country  in  one  year,  I  should  think  it  would  be  many  millions  of  dollars  in  a  country 
the  size  of  ours,  with  its  unequal  distribution  of  population. 

Report  by  Raymond  B.  Fosdick,  Commissioner  of  Accounts,  in  the  matter  of  the  Investigation 
of  the  Accounts  of  the  Municipal  ferries  operated  by  the  Department  of  Docks  and  Ferries,  City  of 
N'ew  York: 

"Our  examination  shows  that  the  net  loss  to  the  city  from  operation  of  the  municipal  ferries 
for  the  six  years  and  sixty-seven  days  banning  October  25,  1905,  and  ending  December  31,  1911,  has 
been  $6,625,606.86,  or  an  average  of  $2,934.93  per  day." 

(American — Editorial) 

New  York  Timfs  Annalist,  December  29.  1913: 

The  unanimity  with  which  those  who  would  socialize  the  railroads  and  the  telephones,  and 
what  not  else,  hit  upon  3%  as  the  probable  cost  of  capital  to  the  government,  is  extraordinary.  Pos- 
sibly it  is  necessary  to  make  it  3%  for  the  sake  of  getting  a  profit  at  the  end.  Mr.  Lewis  reckons  that 
the  telephones  would  cost  only  $900,000,000.  He  would  a  little  less  than  double  the  national  debt. 
Qifford  Thome,  to  socialize  the  railways,  would  increase  it  many  fold,  but  always  at  3%.  Among  the 
great  nations  of  the  world  this  one  is  remarkable  for  borrowing  so  little  and  spending  so  much  out  of 
current  income,  and  its  credit  on  that  account  is  high,  but  its  Panama  Canal  3s  have  been  selling  this 
year  under  par.  It  has  barely  a  3%  credit  now.  If  it  embarked  in  the  telephone  and  railway  business 
and  began  to  issue  bonds  to  replace  private  capital,  it  might  not  long  enjoy  a  3%  credit. 

Greeley.  Colorado.  Republican,  December  19,  1913: 

If  the  Government  takes  over  all  of  the  railroads  and  telephone  and  telegraph  lines  it  must  pay 
an  enormous  sum  for  them.  And  when  the  Government  has  possession,  where  will  the  taxes  come 
from?  From  the  home  and  farm  owners.  Government  certainly  will  not  confiscate  these  properties 
and  some  means  must  be  found  of  raising  the  revenue  which  these  concerns  now  pay. 

New  York  Financial  World,  October  25,  1913: 

We  may  be  old  fashioned,  and  a  set  of  old  fogies,  but  one  little  question  arises  which,  we  will 
probably  be  told  by  the  uplifters  and  social  and  moral  tone  elevators,  amounts  to  nothing.  Neverthe- 
less we  will  ask  it:  whence  is  to  come  the  $1,000,000,000  needed  to  buy  up  both  systems  of  telegraph 
and  telephone  and  the  hundred  and  one  independent  concerns  scattered  all  over  the  country  from 
Yuba  Dam  to  Passamaquoddy  Bay  ?  And  again,  if  we  are  to  govenimentalize  the  telephone  and  tele- 
graph, why  not  include  the  very  necessary  cable  systems  running  to  all  parts  of  the  world  ?  It  would 
only  involve  an  extra  $100,000,000  or  so  to  take  in  the  cable  systems  and,  don't  you  see,  we  could  have 

53 


free  cable  tolls  for  outgoing  business  and  charge  all  the  expense  to  the  foreigner  who  sends  us  mes- 
sages ? 

Cleveland,  Ohio,  Finance,  October  11,  1913: 

In  the  countless  investigations  and  appraisals  of  telephone  property  in  different  parts  of  the 
country,  there  has  been  a  striking  degree  of  uniformity  in  the  values  found  in  excess  of  those  car- 
ried on  the  telephone  books.  In  Boston,  for  instance,  the  existing  plant  could  not  be  duplicated  for 
35%  more  than  its  present  book  value,  according  to  commission  report.  To  duplicate  the  telephone  in 
New  York  City  alone  would  cost  one  hundred  million  dollars  more  than  its  present  book  value,  and  so 
on  among  the  great  cities  of  the  country. 

The  assumption  of  the  Bell  system  by  the  Government  would  easily  involve  a  billion  of  money 
and  that  is  a  large  sum  even  for  a  radical  Democratic  Congress  to  swallow.  Incidentally,  there  is  the 
question  to  be  considered  as  to  whether  the  public  would  not  prefer  the  existing  status. 


MISMANAGEMENT 

(Foreign-^Official) 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  p.  606: 

Mr.  Harry  Lawson  :  *  *  *  I  do  not  believe  that  any  Member  of  this  Committee  can  have 
read  the  history  of  the  telephone  here,  as  set  forth  in  the  different  Reports  made  by  Select  Commit- 
tees, without  thinking  that  in  many  ways  it  is  a  discredit.  It  is  to  a  large  extent  a  case  of  meddle  and 
muddle  on  the  part  of  the  State,  which  never  allowed  private  enterprise  free  play,  and  yet  was  very 
slow  to  accept  any  general  responsibility. 

*    *    *   We  are  behind  all  the  progressive  countries  of  the  world  in  our  telephone  service. 

From  interview  with  M.  Jules  Roche  (French  Minister  of  Posts  in  1890),  member  of  French 
Parliamentary  Post  Office  Committee,  as  published  in  the  Bulletin  de  I' Association  des  Abonnes  au 
Telephone  (Paris,  France),  for  December,  1912  (translation)  : 

A.  It  is  unbelievable,  but  nevertheless  true,  that  the  Post  Office  Administration  does  not  know 
just  how  much  revenue  the  telephone  service  brings  in.  Some  say  30  million  (francs),  others  say 
much  less  than  that,  and  still  others  believe  that  it  costs  more  than  it  brings  in.  *  *  *  But  the  State 
has  a  poor  head  for  business ;  it  knows  neither  how  to  buy,  nor  how  to  sell.  It  conducts  its  business 
very  differently  from  the  man  who  has  put  his  capital  into  some  enterprise  and,  wishing  it  to  pijosper, 
does  not  seek  to  delude  himself  about  the  financial  return. 

Q.  Then  you  are  of  the  opinion.  Monsieur  le  Depute,  that  a  State  monopoly  is  not  a  good 
thing  for  the  telephone? 

A.  The  telephone  service  should  be  left  to  private  industry,  because  the  State  has  to  submit 
to  too  many  influences  other  than  the  needs  of  the  public.  It  is  too  live  and  important  an  undertak- 
ing to  be  ever  fully  developed  by  governmental  sloth.   *   *   * 

Here  is  a  striking  example.  The  administration  cannot  secure  workmen  for  the  construction 
of  its  lines,  unless  it  employs  apprentices,  because  it  does  not  pay  enough.  Skilled  workmen  prefer  to 
find  more  remunerative  employment. 

But  all  this  will  have  to  come  to  an  end.  France  is  a  wonderful  country,  and  our  genius  and 
spirit  of  initiative  must  be  allowed  to  develop.  Some  day  all  this  will  change.  The  State  should  con- 
fine itself  to  governing;  it  has  enough  to  do  if  it  occupies  itself  strictly  with  what  concerns  it,  and 
does  not  seek  to  carry  on  enterprises  which  are  not  within  its  rightful  sphere. 

Report  of  the  Royal  Telephone  Commission  appointed  to  investigate  the  Manitoba  Government 
Telephones  (Winnipeg,  Manitoba,  Telegram,  June  14,  1912) : 

Our  investigation  has  convinced  us  particularly  of  two  facts,  one,  that  supplies  are  purchased 
very  largely  in  excess  of  requirements ;  the  other,  that  excessive  prices  are  paid  therefor  owing  to  lack 

54 


of  competition.  We  feel  that  we  are  amply  justified  in  finding  that  supplies  are  purchased  before  need 
of  them  has  arisen,  by  the  fact  that  on  the  1st  of  January,  1911,  the  value  of  supplies  on  hand  was 
$585,251.63,  that  during  that  year,  supplies  to  the  amount  of  $1,332,599.82  were  got,  and  that  on  the 
first  of  the  year  1912  the  value  of  supplies  on  hand  was  $609,359.22,  at  least  twice  as  much  as  they 
should  have  been,  and  we  may  remark,  in  passing,  as  indicating  the  lack  of  knowledge  of  the  condi- 
tion of  affairs  in  this  department  by  those  responsible  therefor,  that  before  these  figures  were  given 
to  us,  the  chairman,  in  evidence,  stated  the  supplies  on  hand  would  be  about  $400,000,  and  the  com- 
missioner engineer  said  they  would  be  about  $300,000.  *  *  *  Before  leaving  the  subject,  and  as 
further  evidence  of  this  extravagance,  we  may  say  that,  notwithstanding  that  completed  work  could 
not  be  done,  20,000  additional  poles  were  purchased  in  1911,  a  small  part  of  which  was  included  in 
the  162,763  poles  said  to  be  on  hand  in  January  of  this  year,  the  balance  delivered  or  to  be  delivered 
after  that,  and  thus  swelling  this  account  beyond  all  bounds.  In  fact,  poles  were  in  hand  at  the  be- 
ginning of  this  year  sufficient  at  40  poles  to  the  mile  to  build  4,069  miles  of  pole  line,  which  is  within 
a  very  little  of  the  total  of  pole  mileage  constructed  in  the  last  four  years. 

From  Official  Report  by  Senator  Emile  Dupont  on  the  1912  Budget,  Posts  and  Telegraphs, 
French  Senate  Document  No.  35,  Appendix  to  Stenographic  Report  of  session  of  January  30,  1912, 
Pages  190-191  (translation)  : 

Since  the  fusion  of  the  Postal  and  Telegraph  services,  that  is  to  say,  since  1877,  the  Administra- 
tion of  Posts,  Telegraphs  &  Telephones  has  changed  its  organization  six  times. 

First  the  organization  was  under  the  Assistant  Secretary  of  State,  which  later  on  was  changed 
into  a  ministry.  In  1887  it  was  changed  to  a  Direction  General,  under  the  head  of  Ministry  of 
Finance.  A  short  time  thereafter  this  Direction  General  was  placed  under  the  supervision  of  the 
Ministry  of  Commerce.  An  Assistant  Secretary  of  State  was  re-established  in  1896.  The  Assistant 
Secretary  of  State  remained  under  the  direction  of  the  Ministry  of  Commerce  until  1896,  when  he  was 
transferred  to  the  Ministry  of  Public  Works.  In  1909  the  position  of  Assistant  Secretary  of  State 
was  abolished  and  the  management  of  the  Postal,  Telegraph  &  Telephone  Services  was  directly  en- 
trusted to  the  care  of  the  Minister  of  Public  Works.  An  Assistant  Secretary  of  State  was  again 
created  in  1910.  As  a  Direction  General  or  an  "Assistant  Secretariat,"  the  Administration  has  been 
attached  to  three  different  Ministries: 

1st.    The  Ministry  of  Finance. 

2nd.    The  Ministry  of  Commerce. 

3rd.    The  Ministry  of  Public  Works. 

Such  instability  is  plainly  reflected  in  the  methods  and  programs  of  the  Administration. 

From  the  Report  of  the  Royal  Commission  appointed  to  Investigate  the  Postal,  Telegraph  and 
Telephone  Services  of  the  Commonwealth  of  Australia  (ordered  to  be  printed  October  5,  1910) : 

32.  Your  Commissioners  consider  that  the  Central  Executive  in  neglecting  to 
exercise  ordinary  foresight  by  making  the  necessary  provision  to  meet  the  demands  of 
the  public  when  the  telephone  rates  were  reduced  in  1907,  and  in  failing  to  profit  by 
the  experience  of  other  countries  in  similar  circumstances,  is  responsible  for  the  con- 
gested state  of  the  telephone  service,  and  the  consequent  overworking  of  the  officers 
of  the  Department.  The  evidence  discloses  that  the  reductions  in  the  telephone  rates 
were  made  on  the  advice  of  a  subordinate  officer,  and  in  opposition  to  the  advice  of 
the  Permanent  Head  and  Chief  Electrical  Engineer,  and  your  Commissioners  consider 
^y^y*"'^**  that  the  then  Postmaster-General  took  action  without  having  any  sound  reason  for  the 
drastic  reduction  made. 

2^"Jjj||»  40.    In  the  administration  of  the  Commonwealth  Post  and  Telegraph  Department 

it  is  desirable,  in  the  interests  of  the  public,  that  continuity  of  policy  should  be  main- 
tained. The  Central  Executive  attempted  to  formulate  a  definite  policy ;  but  it  was 
alleged  that  a  continuous  policy  could  not  be  exercised  by  the  Department  because  of 
its  incompatibility  with  frequent  changes  of  the  Ministerial  Head.     There  have  been 

55 


nine  Postmasters-General  since  the  inauguration  of  the  Commonwealth,  and  the  evi- 
dence discloses  that  most  of  the  Ministerial  Heads  endeavored  to  effect  signal  altera- 
tions of  policy.  Ministers  are  apparently  anxious  to  signalize  their  occupancy  of 
office  by  some  new  and  distinct  act  of  administration ;  but  due  regard  does  not  appear 
to  have  been  paid  to  the  effect  of  such  actions. 

************ 

DepartmenT*'nrt'''''  Delays  in  the  execution  of  administrative  duties  are  also  occasioned  by  the  en- 

poiitic8i"pu^OTe».     forced  absence  of  the  Minister  from  his  Department  on  political  business. 

From  the  Report  of  the  Committee  of  Finance,  France,  appointed  by  the  Senate  to  examine  the 
Postal  and  Telegraph  Budget  for  the  year  1910  (translation)  : 

The  failure  to  conduct  the  Postal,  Telegraph  and  Telephone  Service  of  France  upon  commer- 
cial principles  is  the  real  cause  of  the  inefficiency  and  backwardness  of  the  Department.   *   *   * 

For  many  years  the  operating  plant,  especially  the  telephone  apparatus,  has  not  kept  pace  with 
the  progress  of  the  art,  and  local  service  has  been  neglected.    ♦    *    * 

A  careful  study  of  the  present  budget,  and  of  many  preceding  ones,  proves  that  the  inefficiency 
of  the  service  is  not  due  to  isolated  faults,  but  to  the  continued  use  of  bad  methods  which  must  be 
eradicated. 

From  Official  Report  on  the  French  Budget  for  Posts  and  Telegraphs,  1908,  pages  11-13,  by 
Joseph  Noulens,  then  Member  of  the  French  Chamber  of  Deputies,  now  Minister  of  War  (transla- 
tion) : 

Despite  the  diversity  of  its  operations,  the  Postal,  Telegraph  and  Telephone  Administration  has 
not  known  how,  or  has  not  desired,  to  apply  the  principle  of  specialization  of  work,  of  which  modern 
industry  has  given  examples  and  demonstrated  the  advantages. 

1*  *1*  T*  T*  T*  T^  T*  •F  T*  T"  *!*  * 

A  clerk  who  has  sorted  letters  in  an  office  for  ten  years  is  appointed  head  clerk  in  the  telegraph 
or  telephone  service;  he  will  be  intrusted  with  the  direction  of  services  which,  up  to  then,  had  been 
totally  strange  to  him;  his  duty  will  consist  in  supervising  a  staff  of  operators,  though  he  is  ignorant 
of  the  manipulation  of  the  modern  instruments,  and  sometimes  of  all  the  instruments. 

************ 

A  clerk  who  has  been  occupied  for  15  years  in  directing  deliveries  of  mails  or  in  marking  postal 
savings-bank  pass-books  is  promoted  to  the  position  of  inspector  of  the  technical  service,  and  in  this 
capacity  is  charged  with  constructing  lines,  performing  electrical  work,  etc.,  all  things  which  he  has  never 
heard  of  before,  things  he  will  neglect  or  do  badly.  He  will  prefer  to  confine  himself  to  clerical 
work  which  will  be  as  nearly  as  possible  like  the  work  he  was  in  the  habit  of  doing. 

(Foreign — Editorial) 

The  Times,  London,  England,  December  20,  1913 : 

Sir, — As  the  treatment  which  I  have  lately  received  from  the  London  Telephone  Service  is  no 
doubt  typical  of  that  meted  out  to  other  unfortunate  subscribers,  my  experience  may  probably  be  of 
interest. 

After  an  unsatisfactory  correspondence  with  reference  to  the  removal  of  an  instrument  from 
a  house  which  I  was  giving  up  I  wrote  the  service  on  October  28  stating  that  I  had  taken  a  new  house 
and  wanted  an  instrument  installed  there  for  use  as  from  December  20.  To  this  I  received  the  usual 
formal  acknowledgment  and  intimation  that  the  matter  would  receive  "immediate  attention."  Not 
hearing  further  I  wrote  again  on  November  21,  and  again  on  December  2,  without  securing  any  reply 
at  all,  although  I  besought  them  in  the  latter  communication  to  tell  me  what  course  I  ought  to  adopt 
to  obtain  a  reply.  Thinking  I  might  manage  to  do  some  good  by  a  personal  request,  I  to-day  rang 
up  the  department  at  102,  Dean-street,  which  was  supposed  to  be  attending  to  the  matter,  and  the 

56 


clerk  to  whom  I  spoke  aflfected  to  be  deeply  concerned  and  promised  me  faithfully  that  the  whole  cor- 
respondence should  be  looked  into  and  that  I  should  be  rung  up  within  an  hour — and  that  is  all  that 
has  so  far  happened.  Yours,  etc., 

26,  Ely-place,  E.  C,  Dec.  18.  M.  Grunebaum. 

The  Times,  London,  England,  November  22,  1913: 

A  curious  instance  of  the  zeal  of  the  department  is  reported.  A  local  hostelry  was  formerly 
on  the  exchange,  but  the  service  was  discontinued  more  than  two  years  ago.  Twice  within  the  past 
fortnight  workmen  have  called  there  in  order  to  examine  the  instrument  "because  complaints  had 
been  received  that  the  subscriber  could  not  get  through." 

The  DaUy  Mail,  London.  England,  July  18,  1912: 

Users  of  the  telephone  will  read  with  astonishment  the  figures  contained  in  Mr.  Herbert  Sam- 
uel's statement  defending  the  Post  Office  management  of  the  London  telephones.  It  is  something,  no 
doubt,  after  the  optimistic  assurances  of  the  past,  to  find  the  Postmaster-General  admitting  that  the 
present  situation  is  "not  satisfactory"  and  that  the  Post  Office  operators  do  sometimes  make  mistakes. 
But  he  minimises  the  grievances  of  the  public  and  can  give  no  guarantee  of  reform  till  the  date  when 
all  the  difficulties  caused  by  the  transfer  of  the  National  Telephone  Company's  system  have  been 
overcome.  Six  months  have  already  passed  and  there  has  so  far  been  deterioration,  not  improve- 
ment. At  this  rate  we  cannot  expect  a  reasonably  efficient  service  much  before  the  millennium.  Yet 
if  skilled  operators  are  not  available  in  sufficient  number,  as  Mr.  Samuel  pleads,  the  entire  responsi- 
bility rests  with  the  short-sightedness  and  parsimony  of  the  Post  Office.  It  took  no  steps  whatever  in 
advance  to  meet  the  needs  of  to-day  by  training  men  and  women  for  the  work.  Consequently  the  sys- 
tem is  now  both  understaffed  and  inefficiently  staffed,  and  the  subscriber's  temper  is  sorely  tried. 

The  Daily  Mail,  London,  England,  July  5,  1912: 

It  is  now  six  months  since  the  Post  Office  undertook  the  working  of  the  telephone  system  of 
the  country.  And  it  might  be  supposed  that  in  that  time  the  difficulties  consequent  on  the  transfer 
of  such  an  immense  undertaking  would  have  been  overcome;  that  the  smooth  working  of  the  service 
would  have  been  brought  about ;  and,  above  all,  that  some  of  the  improvements  expected  when  a 
Government  department,  with  all  its  resources,  takes  over  a  great  organization  would  have  been  re- 
alized. But  the  reverse  is  the  case.  Complaints  of  inefficiency,  delay,  mismanagement,  "wrong  num- 
bers," and  inattention  against  the  Post  Office  are  increasing  in  number,  not  diminishing. 

From  the  Port  of  London  Authority  to  the  small  business  man  and  shopkeeper,  everyone  is  mak- 
ing the  same  complaint,  that  "the  service  is  deteriorating." 

Letter  in  the  Daily  Mail,  London,  England,  June  27,  1912: 

Sir, — On  March  25  the  telephone  contract  for  my  Wimbledon  house  expired.  On  March  18 
I  was  cut  off  with  a  view  to  installing  another  instrument  at  my  new  house  at  Kingston-on-Thames. 
The  telephone  authorities  asked  to  let  them  have  fifteen  days'  notice  to  enable  them  to  put  in  the  new 
telephone,  which  notice  I  gave  at  once. 

From  that  date  till  now  no  instrument  has  been  installed  (although  it  is  installed  in  a  house 
within  200  yards  of  my  own),  but  I  have  received  a  remarkable  series  of  eight  communications,  of 
which  I  give  a  summary: 

1.  Immediate  payment  demanded  for  my  non-existent  telephone. 

2.  L^^l  proceedings  threatened  to  recover  the  money,  which  is  payable  in  advance. 

3.  A  promise  of  immediate  attention  to  my  protests. 

•4.     A  series  of  comminatory  telephone  conversations  to  and  from  my  city  office,  followed  by 

5.  A  notice  cutting  off  my  still  imaginary  telephone,  and  again  legal  proceedings  promised. 

6.  The  scene  then  changed  and  I  received  a  supplicatory  letter  asking  me  to  use  my  good  of- 
fices with  the  local  authorities  in  the  matter  of  wayleaves  (which  I  did). 

57 


7.  A  penitent  promise  to  compensate  me  for  the  delay  by  post-dating  my  next  contract. 

8.  (On  June  18)  Two  forms  arrived  threatening  immediate  proceedings  unless  my  subscrip- 
tion was  paid  at  once.  To  these  I  replied  that  their  office  was  evidently  in  a  state  of  hopeless  disor- 
ganization and  that  I  should  reply  to  no  more  communications. 

To  this  I  have  had  no  answer  at  present,  but  it  will  probably  come  in  the  shape  of  a  bill  for 
excess  calls.  Herbert  M.  Ellis. 

.  Beverley  Wood,  Coombe,  Kingston-on-Thames. 

The  Daily  Mail,  London,  England,  January    31,  1912: 

While  Mr.  Herbert  Samuel  is  touring  the  country  and  delivering  political  speeches  in  which  he 
complacently  congratulates  himself  and  everybody  upon  the  supreme  efficiency  of  the  Government, 
the  administration  of  his  Department  is  going  from  bad  to  worse.  Thus  is  Mr.  Bonar  Law's  charge 
of  incompetence  against  Ministers  justified  by  the  practical  test.  It  is  less  than  a  month  since  the 
Post  Office  destroyed  its  sole  remaining  competitor  in  the  telephone  service  and  took  over  the  National 
Company's  system.  But  already  complaints  are  heard  from  every  quarter  of  a  marked  decline  in  the 
efficiency  of  the  telephone.  One  subscriber  writes  that  "the  service  is  in  a  state  of  chaos."  Callers 
cannot  get  through;  wrong  calls  are  constantly  made;  wrong  numbers  are  frequently  given;  and  the 
method  of  keeping  accounts  appears  to  be  fantastic.  Moreover,  the  service  on  the  old  Post  Office 
system  has  become  perceptibly  slower.  More  time  is  occupied  at  the  exchanges  in  making  the  connec- 
tion, and  the  caller  is  too  often  put  off  with  "line  engaged"  or  the  detestable  buzzing  instrument. 


When  the  House  of  Commons  meets  next  month  Mr.  Samuel  should  be  required  to  take  imme- 
diate steps  to  call  his  Department  to  order.  We  cannot  but  think  that  he  would  turn  his  energy  to 
better  purpose  by  attending  to  the  business  which  the  nation  has  committed  to  him  instead  of  going 
about  the  country  delivering  orations  on  the  absurd  Insurance  Act. 

Bulletin  des  Abonnes  au  Telephone  (Telephone  Subscribers'  Bulletin),  Paris,  France,  February, 
1909,  p.  3  (translation)  : 

Something  is  rotten  in  the  state  of  Telephones.  The  knife  should  be  applied  by  the  Chamber 
without  hesitation. 

Only  a  thorough  Parliamentary  inquiry  such  as  was  held  in  connection  with  the  Navy  can 
disclose  the  cause  of  the  trouble,  and  after  having  heard  the  representatives  of  the  staff,  the  subscrib- 
ers, and  outside  experts,  we  shall  be  able  to  reorganize  this  anarchical  Administration,  fix  responsi- 
bility,  *   *   *  and  draw  up  a  serious  program  of  reform. 

We  have  floundered  long  enough  in  a  mess  which  daily  grows  worse. 


STAGNATION  VS.  EXPANSION 

(Foreign — Official) 

From  the  Chicago,  Illinois,  American,  February  4,  1914: 

"We  have  governmental  ownership  of  telephone,  telegraph  and  postal  systems  at  home,"  said 
Othon  de  Fejer,  chief  of  the  (Hungarian  Government)  telephone  department.  "I  do  not  approve  of 
this  system  so  much  as  privately  owned  companies  because  the  government  does  not  canvass  fqr  busi- 
ness and  extend  the  systems,  which  of  course  is  the  thing  which  makes  them  valuable  to  the  people." 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  page  577: 

Mr.  Herbert  Samuel:     *    *    *    Although  we  are  not   far  behind  Germany,  and  are  much 

58 


ahead  of  France  and  most  of  the  Southern  Continental  countries,  the  telephone  here  is  very  inade- 
quately developed  compared  with  the  United  States,  or  Canada,  or  the  Scandinavian  countries. 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  p.  592 : 

Mr.  Goldman  :  The  United  States  put  in  last  year  no  fewer  than  749,000  telephones.  We  in- 
creased our  service  by  fewer  than  38,000  telephones.  In  other  words,  the  United  States  in  one  year 
increased  their  service  by  more  than  the  whole  service  of  this  country. 

Article  by  C.  S.  Goldman,  M.  P.,  in  the  Daily  Graphic,  London,  England,  March  3,  1913 : 
To-day  the  question  is,  "Are  you  on  the  telephone?"  Under  progressive  control  the  question 
would  be,  "Surely  you  arc  not  off  the  telephone?"  In  other  words,  the  telephone  should  be  a  matter 
of  commercial  and  social  necessity  instead  of,  as  at  present,  an  article  of  luxury.  If  it  were  necessary 
to  seek  for  a  fair  ground  of  condemnation  of  existing  management,  one  would  have  need  to  go  no 
further  than  the  "rates"  question.  The  Government  have  done  absolutely  nothing  in  this  pressing 
matter,  and  this  in  spite  of  all  the  pressure  put  upon  them  by  public  bodies  and  private  interests. 

The  London,  England,  Electrician,  January  17,  1913,  p.  738: 

Last  week  a  deputation  from  the  Town  Councils  of  Dundee,  Aberdeen,  Arbroath  and  Mont- 
rose, and  Chambers  of  Commerce  and  other  bodies  in  these  towns,  waited  on  the  Postmaster-General 
(Mr.  H.  Samuel)  to  urge  upon  him  the  necessity  of  extending  the  underground  telegraph  cables  from 
Edinburgh  to  Dundee  and  Aberdeen. 


In  reply,  Mr.  Samuel  said  the  extension  of  the  underground  telegraph  cables  to  Dundee  and 
Aberdeen  would  involve  a  capital  cost  of  £130,000,  which  would  mean  an  annual  charge  for  interest 
and  sinking  fund  for  15  years  of  £11,287.  The  total  gross  telegraph  revenue  in  Dundee  and  Aber- 
deen was  £16,000  a  year  before  deducting  any  expenses  or  charges.  The  deputation  were  asking  for 
an  annual  expenditure  of  more  than  two-thirds  of  the  gross  revenue — he  did  not  know  that  there  was 
any  net  revenue — in  order  to  avoid  occasional  delays.  There  was  a  loss  in  the  telegraph  system  of  the 
country  of  over  £1,000,000  a  year,  and  therefore  one  had  to  look  carefully  at  any  additional  expendi- 
ture. 

British  Pariiamentary  Debates,  Official  Report,  August  17,  1911,  p.  2118: 

Mr.  Peto:  •  *  ♦  The  Government  have  indicated  to  the  House  that  they  rather  look  to  the 
United  States  of  America  as  a  model  of  what  we  are  to  do  in  this  country.  If  that  is  so,  I  think  it 
would  be  quite  in  order  to  put  briefly  before  the  House  what  that  standard  is  we  are  going  to  try  to 
reach.  The  standard  in  the  United  States  is  76  per  thousand  persons,  whilst  here  it  is  only  15.  In 
order  to  reach  the  standard  of  the  United  States,  which  is  obviously  very  largely  a  question  of  the  de- 
velopment of  telephones  in  the  enormous  rural  areas,  we  should  have  to  increase  our  telephone  sta- 
tions by  2,500,000,  and  we  should  have  to  spend  £76,500,000  at  the  rate  of  £30  per  station. 

From  British  Parliamentary  Debates,  Official  Report,  August  16,  1911,  p.  2007: 
Mr.  Herbert  Samuel:  •  ♦  *  You  cannot,  irrespective  of  loss,  run  your  telegraph  system 
into  remote,  thinly-populated  districts  without  a  full  guarantee.  My  hon.  Friend  persuaded  my  hon. 
Friend  and  colleague  the  Assistant  Postmaster-General,  who  perhaps  may  be  more  softhearted  than 
myself,  in  the  kindness  of  his  heart  to  represent  the  matter  to  the  Treasury.  I  am  not  sure  that  I 
should  have  gone  so  far,  but  the  Treasury  having  gone  into  the  matter  came  to  the  conclusion,  which 
I  came  to  some  time  ago,  that  there  was  no  cause  for  charging  the  general  taxpayers  of  the  country 
with  this  particular  extension.  I  am  afraid,  in  view  of  the  action  taken  by  the  Treasury,  I  cannot 
favor  the  telegraph  being  extended  to  that  place. 

Statistics  compiled  from  official  reports  (published,  or  by  exchange  of  correspondence)  of  the 
various  governments,  giving  the  number  of  telephones  per  100  population  in  European  communities, 

59 


Netherlands 3.0  .74  24.6% 

Sweden  (private  operation  in  Stockholm) ... .  15.7  2.65  16.9% 


and  showing  how  European  governments  have  exploited  the  larger  and  more  profitable  places,  and 
under-developed  the  smaller  and  less  profitable  ones: 

No.  of  Telephones  No.  of  Telephones  Proportion 

per  100  pop.  in  per  lOO  pop.  in  of  rural 

exchanges  of  over  exchanges  of  less  than  to  urban 

Country                                                          100,000  population.  100,000  population.  development 

Austria 2.6  .30  11.5% 

Belgium 1.8  .36  20.0% 

France 2.3  .47  20.4% 

German  Empire   4.6  1.20  26.1% 

Great  Britain 2.7  .76  28.2% 

Hungary 2.6  .25  9.6% 

Italy :                 1.2,  .14  11.7% 

Switzerland 6.0  1.85  30.8% 

Total  of  above  countries 3.16  .67  21.2% 

United  States  11.40  8.50  74.6% 

British  Parliamentary"  Debates,  Official  Report,  June  19,  1911,  p.  87: 

Mr.  Peto  :  *  *  *  I  want  to  say  a  word  or  two  about  the  comparison  with  the  United  States 
of  America,  which  is  constantly  made  by  the  Post  Office  in  their  literature.  I  understand  in  America 
there  are  seventy-six  telephone  subscribers  per  thousand  of  population  whilst  in  this  country  there  are 
only  fifteen  per  thousand.  It  is  obvious  we  have  a  great  deal  of  leeway  to  make  up  before  we  arrive 
at  that  standard. 

Statement  of  Deputy  Joseph  Noulens,  Reporter  of  the  Committee  of  the  French  Chamber  of 
Deputies  on  Posts  and  Telegraphs  (as  published  in  Le  Journal,  Paris,  reprinted  in  the  National  Tele- 
phone Journal,  London,  England,  September,  1908,  p.  24)  : 

Dominated  by  the  routine  methods  which  are  so  characteristic  of  it,  the  Administration  has  not 
foreseen  the  rapid  development  of  the  telephone.  Why  should  it  seek  to  popularize  this  method  of 
communication,  since,  from  the  Administration  point  of  view,  it  appeared  to  be  a  luxury  reserved  only 
for  the  few? 

{Foreign — Editorial) 

Indianapolis,  Ind.,  Star,  December  25,   1913: 

Representative  David  J.  Lewis,  of  Maryland,  who  advocates  Government  ownership  of  tele- 
phones, proceeds  properly  in  assuming  as  an  abstract  consideration  that  use  runs  inversely  as  the 
rates,  but  this  statement  that  the  United  States  ranks  ninth  among  the  nations  of  the  world  as  user 
of  telephone  does  not  agree  with  the  review  of  state-owned  telephones  contributed  to  "Concerning 
Municipal  Ownership,"  by  Sydney  Brooks,  a  Londoner. 

Mr.  Brooks  assumes  that  there  are  sixteen,  millions  telephones  in  use  in  the  world,  of  which 
twelve  millions — his  estimate — are  on  the  North  American  continent.  Europe  by  his  estimate  has 
only  three  millions.  He  declares  that,  roughly  speaking,  there  is  a  telephone  for  every  nine  Ameri- 
cans, and  if  the  same  proportion  obtained  in  Europe,  Denmark  would  have  three  times  as  many 
telephones  as  she  actually  possesses;  Sweden  three  and  one-half  times;  Norway  four  and  one-half 
times ;  Switzerland  five  times ;  Germany  six  and  one-half  times ;  Great  Britain  seven  and  one-half 
times;  the  Netherlands  eleven  times;  Belgium  nearly  eighteen  times  as  many;  France  nineteen  times; 
Austria  all  but  thirty  times ;  Hungary  thirty-seven  times ;  Italy  fifty-six  times ;  Portugal  and  Spain 
about  ninety  times;  Russia  one  hundred  and  five  times,   and   Greece,   Servia  and   Bulgaria  over  one 

60 


hundred  seventy  and  two  hundred  four  time*  as  many.  State  ownership,  he  declares,  is  to  blame  for 
the  puny  development  of  the  telephone  as  a  commercial  necessity  and  social  convenience  in  Europe. 
Service  there  is  inferior  and  the  equipment,  in  antiquated  type  mostly  of  the  magneto  telephone,  gen- 
erally discarded  in  this  country. 

Public  expenditures  of  the  telephone  are  restricted  through  a  mistaken  sen.«e  of  economy  on 
the  part  of  governing  officials,  and  the  indiscriminate  granting  of  working  licenses  to  municipalities 
and  individuals  has  forbidden  development  by  private  investors. 

American  experts  in  telephony  cite  the  disparity  of  service  units  in  this  country  and  abroad  as 
explaining  the  difference  in  prevalent  rates,  on  a  theory  which  they  maintain  by  a  plausible  chain  of 
reasoning,  that  as  the  number  of  stations  increases  the  cost  of  the  individual  station  rises. 

The  Times,  London,  England,  December  1,  1913: 

As  the  result  of  a  short-sighted  Government  policy,  of  official  mismanagement,  and  the  paro- 
chial attitude  of  local  authorities,  the  number  of  telephones  per  hundred  of  the  population  in  Great 
Britain  to-day  is  1.4,  as  against  1.6  in  Germany,  2.1  in  Switzerland,  3.5  in  Denmark  and  Sweden, 
3.7  in  Canada,  and  8.1  in  the  United  States.  London,  the  greatest  city  in  the  world,  boasts  2.8  tele- 
phones for  every  hundred  of  its  inhabitants,  as  against  a  percentage  of  5.3  in  Berlin,  11.0  in  Chicago, 
199  in  Stockholm,  and  24.0  in  Los  Angeles. 

Letter  to  the  London,  England,  Daily  Mail,  September  2,  1913: 

Sl«:  It  may  interest  and  perhaps  surprise  some  of  your  readers  to  learn  the  cost  of  a  telephone 
in  a  country  district  in  England. 

My  house  is  situated  within  a  radius  of  four  and  a  half  miles  of  the  exchange  at  Bury  St.  Ed- 
munds, and  in  answer  to  my  inquiry,  I  am  informed  that  "the  annual  subscription  would  be  approxi- 
mately £40."  As  I  believe  that  there  is  no  extra  charge  for  any  telephone  within  a  mile  of  the 
exchange,  it  means  that  I  am  to  be  charged  at  the  rate  of  i  10  a  year  for  each  mile  of  extension. 

My  only  hope  of  ever  having  a  telephone  here  is  that  I  hear  the  Postmaster-General  is  now  on 
a  visit  to  America  for  the  purpose  of  studying  the  telephone  business.  I  suggest  that  on  his  return 
night  schools  should  be  established  where  telephone  officials  might  be  taught  something  about  tele- 
phones. J.  S.  Austen. 

Plumton  House,  Bury  St.  Edmunds. 

From  the  London,  England,  Times,  July  20,  1910: 

Great  Britain  at  the  beginning  of  this  year  had  602,209  telephones  in  service,  so  the  American 
Bell  system  gained  in  one  year  more  telephones  (nearly  30  per  cent,  more)  than  have  been  installed 
in  Great  Britain  since  the  telephone  began.  The  total  number  of  telephones  in  the  Bell  system  is 
8>4  times  greater  than  in  the  British  system.  Allowing  for  difference  in  population,  there  are  more 
than  four  American  telephones  to  one  British  telephone.  This  disparity  is  increasing  rapidly  in  favor 
of  America,  as  the  development  of  the  American  system  is  increasing  just  twenty  times  more  rapidly 
than  that  of  the  British  system.  If  the  comparison  is  extended  to  the  whole  of  Europe,  it  is  found 
that  the  Bell  system  has  just  twice  as  many  telephones  as  all  Europe.  The  entire  group  of  twenty 
European  countries  with  an  aggregate  population  of  405  millions  can  only  muster  2,583,000  telephones 
as  against  the  5,142,692  telephones  of  a  single  organization  in  America,  serving  a  population  of  be- 
tween 80  and  90  millions.  The  telephone  development  in  proportion  to  population  is  therefore  ten 
times  higher  in  America  than  it  is  throughout  Europe. 

From  the  London,  England,  Times,  July  20,  1910: 

In  Europe  the  general  existence  of  State  telegraph  monopolies  has  doomed  the  telephone  to  a 
Cinderella-like  existence,  and  no  fairy  prince  has  yet  appeared  from  among  the  ranks  of  the  politicians 
with  sufficient  insight  to  recognize  the  possibilities  of  the  suppressed  and  harassed  telephone  and  to 

61 


secure  them  full  scope.     The  fortunate  Americans  have  no  State  monopolies,  and  both  telegraph  and 
telephone  have  been  left  to  work  out  their  own  salvation  as  industrial  enterprises. 

Under  these  conditions  the  telephone  service  has  experienced  a  prodigious  development.  The 
wonderful  facilities  provided  by  a  system  of  instantaneous  and  direct  communication  appeal  readily 
to  such  a  practical  people  as  the  Americans,  and  the  efficiency  and  scope  of  the  telephone  in  America 
have  been  so  steadily  improved  and  extended  that  the  telephone  service  has  become  part  of  the  daily 
business  and  social  life  of  the  people  to  an  extent  unapproached  in  any  European  country. 

Extract  from  "Public  Finance,"  by  C.  F.  Bastable,  Professor  of  Political  Economy  at  the  Uni- 
versity of  Dublin,  Ireland  (3d  Edition,  1903,  Book  II,  Chapter  3,  Pages  210-211) : 

The  dealings  of  state  agencies  with  new  inventions  are  the  worst  blot  on  public  administration, 
and  it  seems  that  there  is  this  risk  in  the  state  telegraphs,  that  though  they  are  quite  up  to  the  stand- 
ard at  their  inception,  they  almost  insensibly  fall  behind  as  it  advances  with  growing  knowledge. 
This  consideration  belongs  to  economic  policy  rather  than  finance,  which,  however,  suffers  from  any 
hindrance  to  commercial  expansion  and  is  certainly  not  likely  to  gain  by  state  telegraphy. 

(American — Editorial) 

Boston,  Mass.,  Advertiser,  December  22,  1913: 

Another  serious  objection  to  Government  ownership  is  that  under  it  expansion  would  be  much 
slower  than  at  present.  The  telephone  companies  are  pushing  their  lines  constantly  into  new  territory 
and  opening  up  a  larger  part  of  the  country.  Very  few  will  contend  that  the  Government  would 
attempt  to  extend  its  lines  into  new  sections  except  after  petitions  had  been  brought  by  the  people 
therein.  And  even  then  a  vast  amount  of  red  tape  would  have  to  be  unrolled  before  anything  would 
be  done.  In  other  words,  instead  of  leading  the  demand,  the  Government  would  follow  it,  which 
means  a  great  deal  to  the  development  of  the  country.  *  *  *  The  initiative  of  private  enterprise 
always  has  been  far  greater  than  that  of  the  Government,  in  any  line,  for  a  number  of  reasons.  And 
it  is  difficult  to  see  how  this  can  be  changed,  because  of  the  absence  of  direct  responsible  authority 
in  Government  matters,  and  the  divorce  between  the  operating  and  financial  departments.  Nothing 
could  be  done  until  the  money  had  been  provided  and  the  delay  in  Congressional  appropriation  is 
proverbial. 

Northampton,  Mass.,  Gazette,  December  18,  1913 : 

As  a  private  enterprise  the  telephone  company  is  very  successful  and  is  also  very  accommodat- 
ing to  public  well-being.  The  Amercian  telephone  system  will,  in  1913,  have  gross  revenues  of  close 
to  $220,000,000,  which  means  a  gain  during  the  last  six  years  of  $90,000,000,  or  70%.  The  balance 
of  net  profits  for  dividends  will  be  around  $50,000,000,  compared  with  $30,000,000  during  1907.  The 
Bell  system  is  devoting  31  cents  of  every  $1.00  of  gross  to  maintenance  and  depreciation,  which  means 
an  outlay  of  close  to  $70,000,000  during  1913. 

New  York  Journal  of  Commerce,  December  12,  1913: 

When  a  large  sum  of  money  has  been  embarked  in  plant  adapted  to  a  specific  purpose,  the 
public  administration  always  looks  with  disfavor  on  any  new  invention  that  may  involve  the  scrap- 
ping of  that  plant.  While  the  same  may  apply  to  any  large  private  enterprise,  nevertheless  while  the 
field  is  open  competitors  with  no  accumulative  plant  are  always  to  be  found  ready  to  risk  their  money 
in  exploiting  the  new  idea  on  the  chance  of  reaping  immediate  profit. 

New  York  Commercial,  November,  1913: 

If  the  city  of  New  York  or  the  Federal  Government  at  Washington  owned  the  telephone  sys- 
tem of  the  municipality  or  the  nation,  as  the  case  might  be,  and  should  make  such  ample  provision  for 
future  needs  as  the  private  corporations  are  now  in  the  habit  of  doing,  the  cry  of  graft  and  extrava- 
gance would  be  raised  at  once.  No  administrator  of  public  aflfairs  would  dare  to  spend  money 
intelligently  in  this  way. 

62 


Extract  from  an  article  by  Dr.  Jacob  Gould  Schurman,  President  of  Cornell  University,  pub- 
lished in  the  New  York  Tribune.  February  25,  1912: 

The  most  that  any  government  has  ever  done  is  to  provide  honest  and  efficient  officials  for  the 
conduct  of  public  business  along  lines  already  established  and  by  the  use  of  methods  and  agencies 
already  familiar  in  private  business.  Creative  epochs  in  industry  are  the  work  of  individuals,  not  of 
governments. 


FINANCIAL  CONSTRICTION 

{Foreign — Official) 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  pp.  593-594 : 
Mr.  Goldman:  *  *  *  Take  the  trunk  (i.  e.,  long  distance)  service  to  which  the  Postmas- 
ter-General also  referred.  There  was  an  exclusive  monopoly.  The  Government  have  been  run- 
ning the  trunk  service  for  fifteen  years  and  we  can  test  their  intentions  and  activities  by  their 
work  in  connection  with  that  service.  If  we  look  at  the  records  we  see  in  the  figures  relating  to 
trunk  service  the  rapid  development  which  is  characterising  itself  in  all  branches  of  telephone  ser- 
vices abroad.  I  find  that  in  the  years  1910  to  1912  there  has  been  no  actual  increase.  There  has 
actually  been  a  drop  in  construction  which  also  coincides  with  a  decrease  in  the  additional  circuits 
that  have  been  added  to  the  service.  In  1910  the  expenditure  in  respect  of  the  service  was  £371,776; 
in  1911  it  was  £279,855,  and  in  1912  it  was  only  £255,000.  In  other  words,  the  expenditure  on  the 
trunk  service  has  declined  by  no  less  than  one-third.  In  1911  they  added  no  fewer  than  182  fresh 
circuits ;  in  1912  there  actually  is  a  reduction  down  to  145.  During  this  period  there  has  been  a  steady 
increase  in  telephones  in  the  local  areas  and  it  is  an  elementary  fact  that  the  more  people  use  the 
local  service,  the  more  people  require  the  trunk  service.  No  doubt  the  Postmaster-General  did  rec- 
(^;nize  the  neglect  of  his  own  service  in  the  matter  of  these  trunks,  because  he  suddenly  came 
forward  last  year  and  stated  to  the  House  that  he  intended  to  spend  in  the  coming  year  £1,000,000 
on  the  trunk  service.  Again,  the  promise  of  the  Postmaster-General  in  that  respect  has  not  been  real- 
ized, because,  instead  of  having  spent  £1,000,000  as  he  intended  to  spend,  on  the  trunk  service,  the 
expenditure  only  amounted  to  approximately  £500,000. 

British  Parliamentary  Debates,  Official  Report,  April  24,  1913,  pp.  592  ff.: 

Mr.  Goldman  :  ♦  ♦  ♦  The  United  States  ♦  ♦  *  spent  last  year  no  less  than  £8,000,000 
on  additional  plant,  and  propose  to  do  the  same  this  year,  as  compared  with  the  insignificant  amount 
which  the  Postmaster-General  now  proposes  to  spend  on  the  telephone  service. 

This  continued  delay  in  carrying  out  necessary  construction  is  most  discouraging  to  those  who 
had  hoped  for  efficiency  in  the  Post  Office  management. 

When  we  faced  the  Postmaster-General  last  year  with  our  criticisms,  he  silenced  us  by  saying 
that  he  intended  to  spend  £2,700,000  on  the  telephone  service  this  year.  Again  he  has  not  fulfilled 
his  promise. 

From  the  Report  of  the  Royal  Commission  Appointed  to  Investigate  the  Postal,  Telegraph  and 
Telephone  Services  of  the  Commonwealth  of  Australia  (ordered  to  be  printed  October  5,  1910)  : 

PMjtian  fcitiBc  45     jhg  starved  condition  of  the  services  is  largely  answerable  for  the  imper- 

fect working  of  the  telephonic  and  telegraphic  installations. 

63 


46.  The  reason  assigned  by  all  the  officials  for  the  failure  to  place  the  ser- 
vices in  proper  working  order  was  want  of  sufficient  funds.  There  is  evidence  that 
the  Department  in  1901  endeavored,  through  the  Treasurer  of  the  time,  to  obtain  the 
necessary  funds  to  place  the  services  in  an  efficient  condition  by  resorting  to  a  loan, 
but  Parliament  refused  to  sanction  this  proposal.     The  curtailment  of  funds  at  that 

AHe^ed  want  of  period  was  apparently  the  result  of  the  desire  to  keep  the  cost  of  Federation  within 
a  limit  of  £300,000  per  annum.  The  adoption  of  that  course,  in  spite  of  the  de- 
mands of  the  Post  and  Telegraph  Department,  is,  in  the  opinion  of  your  Commis- 
sioners, evidence  that  the  system  of  management  is  faulty,  in  that  it  permitted  the 
Treasurer  to  assume  financial  control  of  services  for  whose  efficiency  he  was  not 
responsible.  This  aspect  of  the  position  is  emphasized  by  the  fact  that  the  Treasurer 
was  at  that  time  aware  of  the  necessities  of  the  Post  and  Telegraph  Department,  not- 
withstanding which  he  returned  to  the  States  Governments  the  whole  of  the  surplus 
revenue  beyond  their  constitutional  proportion.  *  *  *  fhe  Central  Executive, 
though  representing  to  the  Postmaster-General  the  omission  to  supply  sufficient  funds, 
should  have  more  persistently  urged  upon  him  the  results  that  would  occur  from  a 

of  funds. '^'"^**'''"'°'  continuation  of  the  starvation  policy.  This  matter  will  be  further  dealt  with  in  the 
financial  section  of  this  Report. 


115.  The  result  of  unduly  curtailing  expenditure  was  pointed  out  repeatedly 
by  the  Department,  and  the  required  provision  was  made  on  the  Estimates,  but  was 
reduced  by  the  Treasurer.  The  longer  reconstruction  is  deferred  and  the  longer 
installation  of  a  new  system  is  postponed  the  more  expensive  the  work  becomes,  on 
account  of  extensions  made  to  the  old  system.  Construction  methods  were  found  to 
MnitTucTion™*"'  '"  ^^  practically  the  same  as  in  1901  as  the  Department  claimed  it  had  been  impossible 
methods.  {q  improve  those  methods  since  that  date,  although  the  adoption  of  improved  methods 

would  obviously  have  tended  toward  economy.  It  may  be  mentioned  that  between  1886 
and  1904  the  New  York  Telephone  Company's  plant  was  reconstructed  three  times  to 
bring  the  equipment  up  to  the  highest  standard,  and  to  render  the  service  more  effi- 
cient. From  1900  to  1907  the  Bell  Telephone  Company,  United  States  of  America, 
spent  about  £70,000,000  on  telephone  undertakings. 

From  speech  by  Deputy  M.  T.  Steeg,  in  the  French  Chamber  of  Deputies,  Session  of  June  23, 
1910  (French  Senate  Document  No.  165) : 

The  history  of  the  telephone  is  only  the  story  of  successive  programs,  very  brilliantly  conceived, 
but  never  realized  for  lack  of  resources. 

(Here  Deputy  Steeg  reports  a  series  of  transactions  indicating  how  the  administration  of  tele- 
phones by  the  French  Government  has  been  hampered  through  financial  constriction,  and  goes  on  to 
say)  : 

Next  M.  Millerand  took  up  the  study  of  the  bill,  completed  a  program  of  reforms  and  was 
looking  for  a  disinterested  person  who  would  lend  him  the  100  million  francs  needed  to  effectuate 
the  plan.  Not  being  able  to  borrow  for  the  needs  of  the  services,  the  Administration  asked  the  Cham- 
ber of  Commerce  of  Paris  to  do  what  the  Administration  was  incapable  of  doing. 

(Foreign — Editorial) 

Le  Journal  des  Transports,  Paris,  France,  December,  1912  (translation) : 

We  said  the  State  is  a  very  poor  businessman  indeed.     It  is  also  a  wretched  financier.    The 

64 


report  of  M.  Dalimier,  a  radical  who  cannot  be     suspected  of  republicanism,  furnishes  us  startling 
proof  of  this. 

*♦♦♦******** 

It  is  not  necessary  to  add  any  more.  The  criticisms  directed  against  the  Postal,  Telegraph  and 
Telephone  Administration  in  the  Chamber  and  before  the  Budgetary  Commission,  will,  alas,  be  use- 
less. All  the  irregularities,  all  the  imperfections  we  have  pointed  out,  are  inherent  in  the  system  of 
operation  by  the  State,  of  services  for  which  it  is  unprepared.  We  repeat  again  and  again  that  the 
State  was  not  meant  to  be  a  business  man.  The  criticism  of  the  Post,  Telegraph  and  Telephone  Admin- 
istration can  be  applied  equally  to  the  Powder  monopoly,  the  National  Printing  Office,  the  Match 
monopoly,  the  Arsenals  and  the  State  Railway  Administrations. 

New  York  Press.  June  21,  1910: 

Telephone  interests  here  are  watching  closely  developments  in  Germany,  where  criticism  has 
been  provoked  because  the  supplementary  budget  for  telephone  purposes  amounts  to  only  25,000,000 
marks,  as  compared  with  44,800,000  marks  in  1907.  60,000,000  marks  in  1908,  and  45,000,000  marks 
in  1909.  It  is  contended  that  the  Post  and  Telegraph  Department  of  that  country  is  too  parsimonious, 
and,  in  asking  for  so  small  an  amount,  has  not  paid  proper  attention  to  the  need  for  improvement  and 
extension  of  its  system. 

The  Times,  London,  England.  July  20,  1910: 

The  public  of  European  countries  finds  itself  denied  a  highly  developed  and  efficient  telephone 
service,  and  thereby  suffers  incalculable  daily  loss.  European  capital  goes  freely  to  America  to  develop 
the  telephone  there,  but  the  European  politician  and  the  European  Government  official  refuse  to  allow 
European  capital,  or  any  other,  to  develop  the  telephone  in  Europe. 

(^American — Editorial) 

Extract  from  the  report  by  S.  Gale  Lowrie  (appointed  by  the  Wisconsin  State  Board  of  Public 
Affairs,  1912,  to  study  Budget  systems)  : 

It  takes  but  a  small  minority  to  block  an  appropriation.  A  slight  majority  in  one  house  can 
refuse  a  grant  for  a  service  which  the  entire  lower  house,  part  of  the  upper  house  and  the  governor 
earnestly  desire.  This  is  a  minority  rather  than  popular  control.  The  theory  that  the  annual  system 
of  appropriations  increases  the  control  of  the  people  over  appropriations  harks  back  to  the  time  of 
limited  appropriations  for  royal  services  and  has  no  place  in  our  modern  legislative  systems. 

Frequent  comparisons  have  been  made  of  late  between  governmental  work  and  that  of  a  busi- 
ness enterprise,  and  although  there  are  well  recognized  differences  between  them  there  are  many 
points  of  similarity.  It  would  be  impossible  to  conduct  any  industrial  enterprise  upon  such  a  policy 
of  temporary  planning  as  the  limited  method  of  support  implies.  Every  large  project  must  have  a 
design  carefuly  thought  out  and  running  through  a  period  of  years,  and  in  order  that  a  plan  may  have 
permanency  it  must  have  a  method  of  support  which  is  not  likely  to  be  interrupted  at  frequent  intervals. 


TAXATION 

(Foreign — Editorial) 

New  York  Times,  December  18,  1913: 

England's  postal  telegraph  has  produced  a  deficiency  of  i  17,455,861  sterling  in  order  to  make 
the  British  postal  tel^raph  a  success.  The  taxpayers  have  paid  a  deficit  averaging  £400,000  for  forty 
years  and  are  now  paying  at  the  rate  of  £840,000. 

65 


(American — Editorial) 

Chicago,  111.,  Farm  and  Home,  January  1,  1914: 

Admitting  both  the  merits  and  demerits  of  the  present  system,  unless  cost  of  service  were  less 
tmder  government  ownership  than  at  present,  rates  could  be  no  lower  unless  the  deficit  was  made 
up  by  general  taxation.  Higher  taxes  to  offset  the  loss  in  the  transportation  department  would  be 
unpopular  indeed. 

There  is  no  magic  in  ownership  and  operation  of  utilities  by  corporation  or  by  township, 
county,  state  or  nation.  It  is  a  question  of  management.  Receipts  must  be  enough  to  pay  all  expenses 
or  the  deficit  must  be  made  up  otherwise.     Either  way  the  public  has  to  bear  the  cost. 

The  peasantry  of  County  Cork  said  when  hoftie  rule  seemed  imminent  years  ago:  "We  will 
neither  plow  nor  plant  because  now  the  Government  will  support  all  of  us."  The  Government  is 
the  people.     Sometimes  it  is  easier  to  supervise  and  control  than  to  operate. 

Boston,  Mass.,  Herald,  December,  1913: 

It  ought  to  be  understood  by  all  intelligent  people  that  everything  performed  by  public  agen- 
cies, whether  of  city,  state  or  nation,  costs  50  per  cent,  more  than  the  same  service  done  under  the 
support  of  self-interest  and  private  initiative.  And  that  extra  50  per  cent,  the  public  must  pay  for 
not  necessarily  in  prices  immediately  affixed.  The  excess  usually  comes  out  of  general  taxation  and 
is  widely  diffused. 

Syracuse,  N.  Y.,  Herald,  December  18,  1913: 

If  the  Government  should  take  over  the  telegraph  lines  and  cheapen  the  rates  of  service,  the 
real  beneficiaries  would  not  be  the  mass  of  the  people,  but  only  a  relatively  small  proportion  thereof. 
Whatever  else  might  be  said  to  the  principle  thus  put  in  practice,  it  certainly  could  not  be  called  the 
principle  of  the  "greatest  good  to  the  greatest  number." 

Extract  from  the  address  of  Seth  Low,  President  of  the  National  Civic  Federation,  delivered 
at  its  Fourteenth  Annual  Meeting  in  New  York  City  on  December  11,  1913: 

I  make  no  apology,  therefore,  for  pointing  out  briefly,  on  this  occasion,  some  of  the  difficulties 
attaching  to  government  ownership  and  operation  of  railroads  in  a  country  like  ours,  with  a  Federal 
government  evolved  as  ours  has  been,  covering  half  a  continent.  Such  information  as  I  can  command 
leads  me  to  believe  that  in  Germany,  France,  Australia,  Italy  and  Austria,  the  earnings  of  the  state- 
owned  railroads  in  each  country  barely  equal,  if  they  do  equal,  the  sums  paid  in  taxation  by  the  rail- 
roads of  the  United  States. 

Providence,  R.  I.,  Daily  Journal,  October  12,  1913: 

How  many  of  the  farmers  and  the  working  men  of  the  United  States  use  the  long  distance 
telephone  and  telegraph?  This  is  a  question  that  has  not  been  answered.  Probably  very  few  are 
interested  in  rates  because  they  are  not  called  upon  to  have  long  distance  conversations.  But  if  the 
Government  should  duplicate  the  existing  trans-continental  lines  at  an  expense  of  several  hundred  of 
millions  of  dollars,  no  one  could  escape  the  heavy  tax  levy.  Why  should  a  man  who  has  no  use  for 
long  distance  messages  pay  taxes  for  a  government  telephone  system? 

Extract  from  an  article  in  The  American  City  (New  York),  April,  1913,  by  George  C.  Whipple, 
Consulting  Professor,  Brooklyn  Polytechnic  Institute: 

The  recent  special  report  of  the  Bureau  of  the  Census  on  financial  statistics  of  cities  of  over 
30,000  inhabitants  *  *  *  showed  that  in  145  cities  the  annual  revenue  receipts  had  increased  in 
eight  years  from  $20.12  to  $27.24  per  capita,  a  gain  of  35.4  per  cent.  The  payments  for  expenses  and 
interest  increased  from  $16.37  to  $20.53  per  capita.  The  governmental  costs  were  higher  in  the  larger 
cities.  In  New  York  City  the  budget  appropriations  were  $26.90  per  capita  in  1900  and  $34.30  in  1910. 
The  report  also  shows  that  in  many  cities,  and  especially  in  the  larger  ones,  the  bonded  indebtedness  is 
increasing  alarmingly. 

66 


As  long  as  the  cities  continue  to  grow  and  assessed  valuations  continue  to  increase,  the  danger 
ahead  is  not  so  easily  discerned ;  but  what  will  hapi>en  when  our  cities  cease  to  grow,  when  the  interest 
on  the  debts  incurred  begins  to  bear  more  heavily  on  the  taxpayers  ?  Will  the  remedy  be  retrenchment 
or  repudiation? 

Were  the  trouble  confined  to  cities  the  case  would  be  bad  enough,  but  it  is  not  confined  to  them. 
State  debts  are  increasing,  and  county  debts,  and  debts  incurred  by  metropolitan  districts  and  by  public 
service  corporations.    Thinking  people  are  becoming  troubled  as  to  how  these  debts  are  to  be  paid. 


EMPLOYEES 
{Foreign — Official) 

Hull,  England,  Eastern  Morning  News,  November  24,  1913,  reporting  a  mass  meeting  of  postal 
employees  at  Hull: 

J.  McCarthy  (Chairman  of  the  Postal  Telegraph  Qerks'  Association)  :  ♦  ♦  ♦  The  Com- 
mittee told  them  that  in  spite  of  repeated  challenges  to  the  staff  no  evidence  was  brought  forward  to 
support  the  proposition  in  the  matter  of  wages,  and  that  the  Post  Office  servants  suffered  no  disad- 
vantage as  compared  with  other  workers.  He  wanted  to  say  that  that  was  not  true.  His  own  asso- 
ciation, the  Postal  Telegraph,  proved  up  to  the  hilt  that  the  telegraphists  employed  by  the  private 
cable  companies  were  in  receipt  of  something  like  30  per  cent,  higher  wages  than  the  Post  Office 
workers. 

News  item  in  the  Daily  News  and  Leader,  London,  England,  October  28,  1913,  reporting  a  meet- 
ing of  representatives  of  the  various  postal  unions : 

Mr.  Stewart,  secretary  of  the  Postmen's  Federation,  explaining  the  objects  of  the  conference, 
said  the  postal  unions  should  join  together  in  order  to  fight  "the  common  enemy."  He  was  sorry  to 
have  to  refer  to  the  Postmaster-General  as  the  "common  enemy,"  but  it  was  no  use  mincing  words. 
If  there  was  one  thing  which  had  made  it  necessary  for  Ihem  to  consider  amalgamation  it  was  the 
publication  of  the  Holt  Committee's  report. 

Article  by  L.  G.  Chiozza  Money,  M.  P.,  published  in  the  Daily  News  and  Leader,  London,  Eng- 
land, October  10,  1913,  referring  to  the  report  of  the  Holt  Committee  on  Post  Office  Servants,  Wages 
and  Conditions  of  Employment: 

•  *  ♦  But  the  Committee  use  a  very  poor  argument  when  they  say  that  the  Post  Office  has 
"no  difficulty  in  recruiting  a  sufficient  number  of  persons  competent  for  the  duties  they  have  to  per- 
form." That  is  the  excuse  made  by  every  bad  employer.  Never  was  yet  a  sweater  who  did  not 
assure  you,  and  truly,  that  his  victims  were  eager  to  take  his  pay,  and  that  he  could  get  heaps  more 
at  an  even  lower  rate. 

Resolution  passed  by  the  executive  committee  of  the  Amalgamated  Society  of  Telephone  Em- 
ployees, published  in  the  Electrical  Industries,  London,  England,  October  8,  1913: 

The  committee  particularly  emphasizes  the  fact  that  no  allowance  has  been  made  for  the  admit- 
ted increase  in  the  cost  of  living ;  it  emphatically  protests  against  the  proposal  to  increase  the  number 
of  working  hours  as  applied  to  certain  grades ;  and  rejects  as  totally  inadequate  and  insignificant  such 
paltry  modifications  of  pay  and  conditions  as  are  recommended.  Further,  it  calls  upon  His  Majesty's 
Government  to  deal  immediately  with  the  existing  position,  which  can  only  be  regarded  as  urgent 
and  dangerous. 

Resolution  of  the  Associated  British  National  Telephone  Engineers,  published  in  The  Electri- 
cian, London,  England,  October  3,  1913: 

This  meeting  of  National  Telephone  engineers  views  with  grave  concern  the  recommendations. 

67 


of  the  Select  Committee  on  Post  Office  Servants,  and  is  strongly  opposed  to  the  acceptance  of  the 
report  by  His  Majesty's  Government,  on  the  grounds  that  the  recommendations  would  not  appear 
to  be  based  on  the  evidence  tendered,  and  moreover  the  report  lends  itself  to  a  harsh  and  prejudiced 
interpretation  in  its  application  to  the  staff  transferred  into  the  service  of  the  State  from  the  National 
Telephone  Co.  Many  anomalies  remain,  such  as  the  placing  of  officers  in  Post  Office  grades  the 
maxima  of  which  were,  are,  and  will  continue  to  be,  according  to  the  recommendations,  below  the 
actual  salary  the  officers  were  receiving  at  the  date  of  transfer;  and  the  drafting  of  officers  perform- 
ing the  same  duties  and  borne  on  the  same  class  under  the  National  Telephone  Co.  into  different 
grades  under  the  department,  much  to  their  detriment. 

The  creation  of  artificial  barriers  as  stumbling  blocks  in  the  lines  of  promotion  of  capable  and 
experienced  officers  is  regarded  as  a  retrograde  step,  and  highly  detrimental  to  the  maintenance  of 
the  high  standard  of  efficiency  attained  under  the  Telephone  Company.     *     *     * 

The  degradation  of  responsible  supervising  officers  from  the  major  to  the  minor  staff,  the 
imposition  of  longer  hours  of  duty  and  the  proposed  transfer  of  officers  to  a  grade  inferior  to  that 
which  they  at  present  occupy  is  considered  reactionary,  arbitrary  and  unjustifiable  on  any  grounds. 

The  scales  of  pay  and  the  annual  increments  proposed  are  quite  inadequate,  and  incommen- 
surate with  the  increased  cost  of  living,  conclusive  proof  of  which  is  given  in  the  recent  returns  issued 
by  the  Board  of  Trade. 

Statement  by  Mr.  L.  S.  Summers,  organizer  of  the  Amalgamated  Society  of  Telephone  Em- 
ployees, published  in  the  Nottingham,  England,  Guardian,  August  28,  1913 : 

Mr.  L.  S.  Summers  declared  emphatically  that  the  conclusions  come  to  by  the  Holt  Committee 
were  entirely  unsatisfactory.  (Applause.)  The  whole  of  the  transferred  staff  were  indignant  at  the 
recommendations  arising  out  of  the  transfer  from  the  National  Telephone  Company  to  the  Post 
Office.  (Hear,  hear.)  The  recommendations  of  the  Select  Committee  meant  an  increase  of  2j4  hours' 
work  per  week;  while  as  regarded  pay,  whereas  the  Amalgamated  Society  submitted  27s.  a  week  as 
a  minimum  living  wage,  the  Select  Committee  recommended  the  miserable  wage  of  26s. — a  disgrace 
to  the  Government  of  the  country.     (Applause.) 

Resolution  of  the  Amalgamated  Society  of  Telephone  Employees,  published  in  Morning  Post, 
London,  England,  August  27,  1913: 

*  *  *  This  meeting  expresses  strong  indignation  at  the  unsatisfactory  recommendations  con- 
tained in  the  report  of  the  Holt  Committee.  We  pledge  ourselves  to  support  the  Executive  Committee 
of  the  A.  S.  T.  E.  in  whatever  action  may  be  deemed  advisable,  but  we  are  also  of  opinion  that  the 
Executive  Committee  should  adopt  a  much  stronger  line  of  action  to  secure  immediate  redress  on 
the  many  grievances  still  existing. 

Resolution  of  the  National  Joint  Committee  of  Post  Office  Employees,  concerning  the  Report 
of  the  Parliamentary  Committee  on  Wages  and  Conditions  of  Service  in  the  Post  Office,  printed  in 
the  Times,"London,  England,  August  23,  1913: 

*  *  *  this  meeting  declines  to  accept  the  report  of  the  Select  Committee  as  a  proper  verdict 
on  its  just  and  moderate  claims.  It  emphatically  states  that  no  juggling  with  pence  will  dispose  of  the 
admitted  increase  in  the  cost  of  living,  and  it  regards  the  proposals  to  increase  the  working  hours  of 
the  staff  under  the  guise  of  a  concession  as  an  insult  to  the  intelligence  of  the  Post  Office  employees. 

Financial  Times,  London,  England,  April  2,  1913: 

Mr.  Jeffreys,  an  official  of  the  Amalgamated  Society  of  Telephone  Employees,  was  called  be- 
fore Mr.  Holt's  Select  Committee  on  Postal  Workers'  Grievances  at  the  House  of  Commons  yester- 
day, and  on  behalf  of  the  staff  of  the  National  Telephone  Company,  taken  over  by  the  Post  Office 
at  the  time  of  the  transfer  of  the  company's  undertaking,  complained  that  the  Government  pledge 
that  no  official  should  suffer  by  the  transfer  had,  in  fact,  been  violated.  Their  prospects  of  promotion 
had,  he  contended,  been  seriously  depreciated. 

68 


Extract  from  a  news  item  in  the  Herald,  Glasgow,  Scotland,  March  22,  1913,  giving  an  account 
of  the  annual  meeting  of  the  Amalgamated  Society  of  Telephone  Employees: 

The  Chairman,  in  his  inaugural  address,  said  that  they  of  the  staff  of  the  old  National  Tele- 
phone Company  were  now  in  a  position  *  *  *  to  appreciate  the  effect  of  the  many  disadvantages 
under  the  new  conditions  of  service   *    *    * 

Future  prospects  of  the  staff  generally,  find  in  particular  the  prospects  of  the  electrical  staff, 
were  of  so  hopeless  a  character  that  many  members  had  already  given  up  the  service  in  disgust.  Those 
who,  owing  to  the  telephone  industry  in  the  United  Kingdom  being  a  State  monopoly,  and  through 
various  circumstances,  must  of  necessity  continue  in  the  employ  of  the  State,  were  working  under 
State  conditions  with  the  iron  of  discontent  scaring  into  their  souls.    ♦    *    * 

The  main  point  so  far  as  the  staff  was  concerned  was  that  State  service  had  been  tried  and 
found  wanting. 

Extract  from  a  resolution  and  comment  thereon  by  Mr.  Thomas  (delegate  for  telephone  em- 
ployees) at  a  meeting  of  the  Birmingham  Trades  Council,  published  in  the  Birmingham,  England, 
Post,  December  9,  1912: 

"This  meeting  of  the  Birmingham  Trades  Council  draws  the  attention  of  the  Postmaster- 
General  to  the  unsatisfactory  condition  of  the  staff  of  the  late  National  Telephone  Company,  parti- 
cularly in  the  matter  of  lower  annual  increment,  lower  lodging  allowance,  overtime  rates,  sick  pay,  and 
lower  maxima  in  the  various  grades,  and  calls  on  him  to  fulfill  his  promise  made  to  the  employees  when 
the  Transfer  Bill  was  in  Committee;  and  maintains  *  *  *  that  the  manner  in  which  the  telephone 
operators  had  been  treated  is  a  menace  to  progress  which  cannot  be  tolerated." 

In  moving  the  resolution,  Mr.  Thomas  *  •  *  pointed  out  that  the  Postmaster-General  prom- 
ised that  the  employees  should  be  treated  not  only  with  justice  but  with  generosity.  Mr.  Thomas  gave 
several  instances  of  reductions  sustained  by  telephone  workers.  The  workpeople  had  been  classified 
in  a  disgraceful  manner,  many  of  the  first-class  certificated  operators  having  been  reduced  to  second 
and  third  class. 

From  a  pamphlet  printed  in  1910  by  the  Italian  Postal  Telegraph  Qerks'  Association,  Hon. 
Filippo  Turati,  Member  of  Parliament,  Italy,  President  (translation)  : 

Even  the  foreign  press  has  occupied  itself  with  this  problem  (of  the  telegraph  service),  laugh- 
ing at  us  merrily. 

The  Government,  on  *the  other  hand,  has  inverted  things ;  pays  less  for  overtime  labor ;  has 
done  even  more ;  paying  everyone  badly,  it  has  forced  the  workers  to  struggle  amongst  themselves  for 
this  overtime  work,  degenerating  into  "Krumiri."  And  the  Government  is  convinced  that  it  will  win 
much  in  this  affair,  and  will  make  an  excellent  sj>eculation.  The  workers  have  understood,  and 
everyone  knows  that  the  masters  have  nothing  to  gain  by  killing  and  exhausting  the  blood  of  the 
workers.  But  the  government  docs  not  yet  understand  these  elementary  matters,  does  not  under- 
stand the  danger  that  accrues  to  industry  from  tired  and  discontented  workers  which  renders  fraud 
inevitable. 

(Foreign — Editorial) 

From  a  letter  from  the  Marquis  de  MontebcUo,  President  of  the  .Xssociation  of  Telephone 
Subscribers,  to  the  Editor  in  Chief  of  Le  Matin,  Paris,  France,  reprinted  in  the  Bulletin  des  Abon- 
nes  au  Telephone  (Bulletin  of  the  Telephone  Subscribers'  Association),  Paris,  France,  December, 
1913  (translation)  : 

Note: — Roubaix  ranks  12th  in  population  among  French  cities. 

Permit  me  to  request  the  aid  of  the  wide  publicity  of  the  Matin  to  call  attention  to  the  truly 
scandalous  conditions  under  which  the  postal,  telephone  and  telegraph  services  operate  at  Roubaix. 
*  *  •  I  shall  speak  to  you  only  of  the  telephone  service,  adding,  however,  that  the  postal  and  tele- 
graph services  are  no  better  organized. 

69 


The  solitary,  narrow  staircase  which  serves  the  various  floors  is  repulsively  filthy  and  falling 
into  ruins.  The  tottering  railing  is  altogether  lacking  in  several  places.  The  rooms  reserved  for  the 
various  services  are  in  the  same  state  of  dilapidation ;  the  walls  have  not  been  painted  or  papered  for 
several  decades;  the  floors  are  rotten  and  enormous  holes  open  up  under  one's  feet;  the  ceihngs  are 
falling  down  and  must  be  supported  by  timber  braces  and  by  props. 

These  ridiculously  confined  quarters  are  arranged  in  a  manner  contrary  to  the  most  elemental 
laws  of  hygiene  and  of  comfort;  one  roasts  in  them  in  summer;  one  freezes  in  winter;  the  atmosphere 
is  not  fit  to  breathe ;  the  arrangement  of  the  furniture  does  not  permit  the  removal  of  the  dust  that 
has  accumulated  for  years ;  a  single  little  door  serves  as  an  exit  for  about  fifty  employees ;  no  measure 
of  precaution  has  been  taken  against  a  conflagration,  which  is  always  imminent,  unless  the  presence  of 
a  bucket  of  water  can  be  regarded  as  such  a  precautionary  measure.  This  bucket,  however,  also 
serves  as  a  washstand  for  the  whole  staff  of  employees ! 

From  a  speech  delivered  at  Tourcoing,  France,  by  the  Marquis  de  Montebello,  the  President  of 
the  Association  of  Telephone  Subscribers,  printed  in  the  Bulletin  de  l' Association  des  Abonnes  au  Tele- 
phone (Bulletin  of  the  Telephone  Subscribers'  Association),  Paris,  France,  December,  1913  (trans- 
lation) : 

Note  : — Roubaix  ranks  twelfth  in  population  among  French  cities. 

The  lecturer  speaks  of  the  visit  which  he  made  during  the  morning  to  the  telephone  exchange  at 
Roubaix,  which  serves  Roubaix  and  Tourcoing.  "I  saw  there,"  says  he,  "a  prehistoric  installation; 
the  old  shelf -switchboard,  which  has  been  abandoned  abroad  for  nearly  thirty  years,  is  still  in  use 
there.  The  offices  are  arranged  under  conditions  contrary  to  all  the  principles  of  hygiene  and  even  to 
simply  humanitarian  principles.  It  is  disgraceful,  ignoble,  inhuman.  If  a  business  man  had  such  offi- 
ces, the  labor  inspector  would  have  them  closed  immediately.  In  the  most  barbarous  countries,"  he 
adds,  "employees  are  not  treated  as  at  the  exchange  at  Roubaix."  He  mentions  in  particular  that, 
for  their  only  wash-stand,  they  have  an  old  zinc  bucket  in  which  they  have  had  to  stop  up  a  hole  with 
plaster. 

From  the  Civil  Service  Gazette,  London,  England,  October  18,  1913,  referring  to  criticism  by 
L.  G.  Chiozza  Money,  M.  P.,  concerning  recommendations  of  the  Holt  Committee  on  Post  Office 
Servants  (Wages  and  Conditions  of  Employment) : 

*  *  *  Mr.  Chiozza  Money  is  a  supporter  of  the  Government,  but  he  does  not  mince  matters. 
He  states  quite  plainly  that  the  argument  used  by  the  Committee,  and  concurred  in  by  the  Secretary 
of  the  Post  Office  (i.  e. — -that  the  Post  Office  has  no  difficulty  in  securing  employees  at  the  wages  it 
offers) — is  the  argument  which  is  used  by  every  "bad"  employer. 

He  thus  asserts  that  the  Post  Office  is  a  bad  employer.  We  do  not  dispute  the  truth  of  this 
assertion.  The  Post  Office  is  a  bad  employer,  and  yet  the  Post  Office  is  one  of  the  most  important 
parts  of  the  machinery  controlled  by  a  State  which  claims  to  be  "the  model  employer." 

The  Electrician,  London,  England,  August  15,  1913: 

The  condition  of  affairs  at  the  present  moment  is  much  more  serious  from  the  engineering 
aspect,  for  we  understand  that  so  numerous  have  been  the  resignations  from  among  the  engineering 
members  in  what  we  may  term  the  "National  Telephone  section"  of  the  staff  that  those  in  authority 
are  becoming  greatly  concerned.  *  *  *  The  reasons  for  the  defection  are  alleged  to  be  that  the  en- 
gineering staff  generally  is  dissatisfied  with  the  conditions  in  their  particular  branch  of  the  State  serv- 
ice, not  so  much  from  the  pecuniary  side  (though  there  is  discontent  on  that  score),  but  because  of  the 
lassitude  and  absence  of  "momentum"  which  confronts  them  and  seems  to  pervade  the  very  atmo- 
sphere. These  men  feel  that  promotion  is  blocked  for  years  to  come,  and  that  what  little  advancement 
they  may  hope  to  gain  will  be  determined  by  seniority  in  the  service  rather  than  by  their  engineering 
qualifications.  They  feel  that  any  initiative  or  foresight  they  possess  is  of  no  use  to  them,  while  their 
work  is  rapidly  losing  that  absorbing  interest  it  once  had  for  them.  The  result  is,  we  learn,  that  the 
best  of  the  juniors  are  rapidly  leaving  the  service,  while  the  seniors  of  the  old  service,  for  whom  the 

70 


task  of  obtaining  other  employment  is  more  difficult,  are  tending  to  become  slack  and  inert  through 
the  depression  of  their  surroundings. 

The  Telegraph  Chronicle  and  Civil  Service  Recorder,  London,  England,  July  18,  1913: 

The  better  pay  and  prospects  offered  by  cable  companies  have  been  instrumental  in  depleting 
BM.  (tel^raphic  code  for  Birmingham)  of  two  capable  juniors  *  *  *  who  have  shaken  the  dust 
of  the  local  telegraph  office  off  their  feet  and  started  with  the  Eastern  Company  at  a  commencing  sal- 
ary of  no  less  than  8s.  per  week  in  advance  of  what  they  were  receiving  from  the  what-ought-to-be- 
but-aint  model  employer,  and  with  the  assurance  of  an  annual  increment  worth  the  having  and  a  max- 
imtmi  such  as  would  positively  cause  the  death  of  some  of  our  noble  administrators  if  it  were  suggested 
to  them  that  Government  employees,  doing  the  same  work,  should  have  a  chance  to  attain. 

The  Northern  Whig,  Belfast,  Ireland,  March  22,  1913 : 

We  publish  this  morning  some  very  interesting  and  important  statements  made  yesterday  by 
Mr.  Preston,  president  of  the  annual  Conference  of  Telephone  Employees.  According  to  his  remarks, 
the  whole  telephone  staff  are  simply  disgusted  with  the  conditions  of  service  under  the  Government. 

The  Glasgow,  Scotland,  Herald;  March  22,  1913 : 

♦  ♦  ♦  The  State  on  the  first  serious  attempt  on  a  large  scale  to  buy  up  and  manage  a  public 
utility  has  failed  to  demonstrate  that  it  is  a  model  employer.  The  Government  telephonist  is  worse  off 
than  he  was  when  he  worked  for  a  private  employer,  whose  first  concern  was  to  earn  a  dividend. 

Article  by  the  Parliamentary  Correspondent  of  the  Daily  Herald,  Glasgow,  Scotland,  reporting 
a  meeting  of  the  Telephonists'  Branch  of  the  Postal  Telegraph  Qerks'  Association,  published  January 
22,  1913: 

Mr.  W.  J.  Ash  :  *  *  •  men  who  have  to  be  experts  in  their  profession,  who  work  on  con- 
tinuous and  extremely  responsible  night  duty,  have  the  paternal  incentive  to  good  work  of  a  maxi- 
mum salary  of  30s.  a  week.   *   *   • 

Increditable  as  it  may  seem,  these  men  have  not  even  been  established  at  a  regular  post  office 
rating.  That  is,  their  job  is  considered  a  sort  of  superior  blind  alley,  and  they  are  as  good  as  shown 
the  door  after  ten  years'  faithful  service. 

Manchester,  England,  Evening  Chronicle,  December  11,  1912: 

That  the  employees  of  the  National  Telephone  Company  are  anything  but  satisfied  with  their 
experiences  since  becoming  State  servants  is  indicated  by  the  fact  that  a  protest  meeting  on  their 
behalf,  is  being  called  this  week  in  Manchester.  The  "ideal  employer"  is,  in  many  cases,  demanding 
lower  wages  and  longer  hours  than  the  old  company  found  necessary  to  successfully  work  the  system. 
The  company's  employees  also  have  another  legitimate  grievance.  When  they  were  taken  over  promo- 
tion was  promised  on  the  basis  of  work  done,  but  despite  the  fact  that  they  had  had  in  their  hands 
an  overwhelming  proportion  of  the  telephone  exchanges  and  lines  throughout  the  country  very  few 
of  the  superior  positions  have  been  given  to  them.  ♦  •  •  Here,  again,  we  have  an  example  of  broken 
promises  and  favoritism  unworthy  of  this  "model  employer,"  ♦  *"  ♦  Neither  are  the  public  any  better 
pleased  with  the  change,  and  the  net  result  of  the  transfer  has  been  another  proof  of  the  unsatisfac- 
tory character  of  the  much-vaunted  State  Services. 

Manchester,  England,  Evening  Chronicle,  E>ecember  11,  1912: 

It  is  customary  for  a  certain  class  of  writers  and  speakers  to  hold  up  the  State  as  the  ideal  em- 
ployer. •  *  *  But  it  is  well  known  that  Post  Office  workers  have  many  real  grievances  which  they 
cannot  get  remedied,  and  now  it  appears  that  the  vagaries  of  State  management  are  causing  seething 
unrest  in  the  Labor  Exchanges  and  the  Telephone  Service.  The  grievances  in  both  cases  appear  to  be 
quite  legitimate,  and  they  are  bad  enough  to  bring  about  organized  effort  to  secure  readjustment  of 
conditions.  Under-payment  for  the  work  done  and  preferential  treatment  in  regard  to  promotions  are 
the  chief  causes  of  complaint  in  both  cases. 

71 


Leeds,  England,  Mercury,  November  15,  1912: 

A  memorial  submitted  to  the  Postmaster-General  on  behalf  of  the  telephone  employees  sets 
out  that  grave  unrest  exists  amongst  the  staff  all  over  the  country,  particularly  amongst  those  em- 
ployees who  have  been  taken  over  from  the  National  Telephone  Company's  staff. 

************ 

The  chief  allegations  are  that  the  men  and  women  employees  are  considerably  worse  off  with 
respect  to  ordinary,  overtime,  and  Sunday  pay,  sick  pay  (reduced  by  one-third  in  the  case  of  non-es- 
tablished employees),  and  persons,  while  hours  are  longer  in  nearly  every  case. 

Pall  Mall  Gazette  (London,  England),  November  13,  1912.     Article  by  Filson  Young: 

A  little  light  was  thrown  for  me  the  other  day  on  the  mysterious  cause  of  the  inefficiency  of 
the  telephone  service.  I  was  talking  to  a  linesman  as  he  ate  his  dinner  outside  one  of  those  curious^ 
little  combinations  of  tents  and  caves  which  establish  themselves  for  an  hour  or  two  at  the  comers 
of  London  streets. 

I  asked  him  why,  if  the  same  staflf  had  worked  the  system  under  the  National  Telephone  Com- 
pany, they  could  not  do  so  with  equal  efficiency  under  the  Government.  "It  is  quite  true,"  he  said,  "it 
is  the  same  staff,  but  the  conditions  aren't  the  same.  Our  pay  remains  the  same,  but  our  conditions 
are  less  good.  All  our  old  arrangements  have  been  knocked  out  and  no  new  ones  put  in  their  place. 
Take  my  case.  Under  the  National  Telephone  Company  I  could  have  gone  on  being  promoted  until 
I  became  a" — I  forget  what.  "Now  I  can  only  go  on  to  such  and  such  a  grade,  at  thirty-five  shillings 
a  week.   *   *   * 

"Now,"  added  my  friend,  as  he  prepared  to  descend  again  into  the  cave,  "a  few  people  feeling 
like  that  in  a  service  make  no  difference.  But  when  you  get  thirty  or  forty  thousand  people  all  dis- 
satisfied and  all  discouraged — well,  the  service  is  bound  to  suffer.    It  stands  to  reason,  don't  it?" 

Birmingham,  England,  Post,  November  2,  1912: 

Widespread  discontent  has  prevailed  among  telephone  employees  since  the  transfer  of  the  service 
to  the  State,  and  meetings  are  being  held  throughout  the  country,  under  the  aegis  of  the  Amalga- 
mated Society  of  Telephone  Employees.  Grievances,  it  is  said,  are  felt  in  practically  every  department 
of  the  service,  but  they  are  declared  to  be  more  acute  in  the  electrical  and  engineering  sections.  These 
departments  were  considered  by  the  Post  Office  authorities  to  be  unworthy  of  a  proper  grade,  and  a 
large  number  of  the  employees  were  classified  as  "unestablished  workmen."  Emphasis  is  laid  on  the 
fact  that  although  the  men  in  this  department  are  qualified  electricians,  and  that  many  of  them  have 
passed  examinations  and  gained  certificates,  in  some  cases  in  the  provinces  the  rate  of  pay  has  been 
5j'2d.  and  6d.  an  hour.  Some  of  these  engaged  in  these  sections  receive  29s.  3d.  per  week,  but  the 
average  is  considerably  below  that  earned  before  the  transfer. 

It  is  further  declared  that  the  majority  of  the  employees  have  to  work  longer  hours,  while  the 
rate  of  pay  for  overtime  and  Sunday  work  has  been  reduced;  sick  pay  has  also  been  reduced  to  two- 
thirds  in  the  case  of  unestablished  workmen,  and  pension  benefits  have,  as  the  result  of  the  lack  of 
classification,  been  abolished  in  many  instances. 

John  Bull  (British  weekly  published  by  Horatio  W.  Bottomley,  M.  P.),  September  28,  1912: 
Is  it  not  a  puzzle  that  everybody  is  complaining  since  the  telephones  were  taken  over  by  the 
State?  The  same  staff  is  employed,  and  there  is  no  apparent  reason  why  it  should  behave  differently. 
Now  the  unseen  fact  in  connection  with  the  Post  Office  telephones  is  that  the  whole  staff  is 
a  seething  mass  of  discontent.  *  *  *  Work,  pay,  prospects,  sick-leave,  pensions — in  fact,  all  the  es- 
sentials of  their  careers — remain  unsettled,  and  it  is  not  to  be  wondered  at  if  the  strain  on  their  minds 
interferes  with  their  alacrity  and  good  temper. 

I)!*********** 

The  result  of  all  this  chaos  and  pin-pricking  is  that  men  go  about  listlessly,  and  their  overseers, 
being  also  disheartened,  feel  no  call  to  remonstrate.   *   *   *  The  men  are  loth  to  strike,  but  they  feel 

72 


that  they  have  been  very  badly  treated  and  that  they   would  be  perfectly   justified   in   taking   strong 
measures  to  secure  their  rights. 

(American — Official) 

Congressional  Record,  January  19,  1914,  page  2018 : 

Mr.  Beakes:  *  ♦  *  The  fault  with  the  civil-service  system,  as  I  view  it,  is  that  when  a 
man  gets  in,  after  a  few  slight  and  immaterial  promotions,  there  is  nothing  ahead.  In  business  cir- 
cles, outside  the  Government  service,  a  man  begins  down  in  the  ranks  and  he  is  spurred  on  by  the 
knowledge  that  if  he  shows  unusual  knowledge,  skill,  efficiency,  or  capacity,  there  is  almost  no  limit 
as  to  how  far  up  the  ladder  he  may  climb.  There  is  always  something  ahead  for  him.  But  in  the 
civil  service,  after  one  or  two  rungs  of  the  ladder,  there  is  a  blank  wall  and  nothing  ahead. 

Congressional  Record,  January   16,  1914,  page  1826: 

Mr.  Griffin  :  *  *  *  The  employees  in  the  Postal  Service,  and  particularly  the  city  and 
rural  carriers,  post-office  clerks,  and  laborers,  are  paid  only  for  the  actual  time  they  are  employed. 
When  overtaken  by  sickness  or  if  they  meet  with  an  accident  and  become  incapacitated  for  duty  their 
pay  ceases  at  once.  It  matters  not  if  an  accident  was  caused  by  the  grossest  negligence  on  the  part  of 
the  Government,  these  employees  have  no  redress  for  damages,  not  even  for  the  loss  of  salary.  They 
are  laid  off  without  pay  until  they  are  able  to  assume  their  official  duties,  and  should  the  sickness  or 
accident  be  of  a  nature  to  confine  them  for  a  period  of  more  than  150  days  they  are  notified  to  hand 
in  their  resignation,  because  a  department  rule  provides  that  no  employee  will  be  excused  for  a  longer 
period,  no  matter  what  the  cause  may  be. 

Congressional  Record,  January  16,  1914,  page  1826: 

Mr.  Griffin  :  ♦  *  ♦  It  has  been  stated  that  the  personnel  of  the  Postal  Service  changes 
every  seven  years,  and  this  will  give  an  idea  of  the  small  percentage  of  those  who  do  make  it  their 
life  work.  And  now,  Mr.  Chairman,  what  is  the  reward  for  these  men  and  women  who  give  the  best 
>ears  of  their  lives  to  the  public  service?  Well,  it  is  hard  for  me  to  say  it,  because  I  detest  ingrati- 
tude, governmental  or  otherwise,  these  employees  are  forced  to  resign  when  they  become  superannu- 
ated, unceremoniously  kicked  out,  and  told  that  they  are  inefficient  and  can  no  longer  do  the  work  re- 
quired of  them — outlived  their  usefulness.  It  is  one  of  the  saddest  incidents  of  our  governmental  life. 
Thrown  out  with  the  flotsam  and  jetsam  of  humanity  who  have  no  aim  or  object  in  life,  because  years 
of  ardent  labor  have  used  up  their  energy  and  vitality.  Yes,  Mr.  Qiairman,  like  an  obsolete  piece  of 
machinery  or  a  broken  piston  rod,  they  are  thrown  on  the  scrap  heap. 

Congressional  Record,  January  16,  1914,  page  1846: 

Mr.  Reilly:  ♦  *  ♦  It  was  not  until  I  became  a  member  of  this  body  that  I  learned  that 
old  worn-out  letter  carriers  and  other  superannuated  employees  of  the  Government  were  not  retired 
on  part  pay,  but,  on  the  contrary,  were  dismissed  from  the  service  when  they  could  no  longer  keep 
up  the  pace.  One  of  the  first  letters  I  received  after  being  elected  a  Member  of  Congress  was  from 
an  old  postal  employee,  who  had  received  an  official  notice  from  \\\s  postmaster  informing  him  that 
he  had  been  oflF  duty  the  allotted  number  of  days  in  the  year  allowed  by  the  department  and  that  his 
resignation  would  be  accepted.  The  simple  statement  of  that  heart-broken  man  asking  me  to  assist  in 
having  him  kept  on  the  rolls  made  my  heart  ache.  He  had  spent  34  years  of  his  life  pounding  the 
pavements  in  all  kinds  of  weather  and  at  all  hours  of  the  day  and  night,  and  was  known  and  loved  by 
the  citizens  of  the  community  he  served,  composed  of  all  classes  and  creeds  and  political  affiliations. 
He  had  not  only  given  the  best  years  of  his  life  to  the  Government  in  building  up  the  Postal  Service,  but 
was  at  an  age  and  in  such  a  condition  that  he  could  not  hope  to  find  employment  of  any  kind.  He 
was  in  such  financial  straits  that  if  thrown  on  the  world  he  would  have  to  depend  on  the  bounty  of 
relatives  or  friends,  or  else  become  a  public  charge. 

What  a  cruel,  cruel  fate  to  leave  a  man  to  who  had  lived  an  honorable,  upright  life  and  was  a 
model  citizen.    Why,  Mr.  Chairman,  if  this  man  had  worked   for  a  railroad  company  or  a  banking 

73 


institution  or  a  large  corporation  of  any  kind,  and  was  treated  in  such  a  manner,  it  would  be  the 
subject  of  public  condemnation.  But  being  a  life-long  employee  of  the  Government  no  one  seems  to 
take  more  than  a  passing  interest  in  him.  We  legislate  here  to  curb  the  trusts  and  the  railroads  and 
corporations,  and  denounce  them  as  soulless,  but  I  believe  it  would  be  well  for  us  to  reflect  and  take 
a  few  leaves  from  the  book  of  rules  which  govern  them  in  their  treatment  of  their  employees. 

Congressional  Record,  January  16,  1914,  page  1846: 

Mr.  Reilly:  *  *  *  i  believe  the  Government  is  the  poorest-paying  employer  in  the  world, 
and  I  say  that  intending  to  include  therein  all  branches  of  the  service  from  the  man  who  receives 
$800  to  the  man  who  receives  $8,000.  I  believe  that  the  same  service  with  the  same  ability,  the  same 
intelligence,  the  same  faithfulness  given  to  this  Government  if  given  to  a  private  corporation  would 
receive  in  reward  double  the  pay  on  an  average  that  the  Government  pays  to-day. 

New  York  Press,  December  8,  1913 : 

Poor  pay  in  the  Government  service  is  sending  many  scientific  experts  outside  for  employment, 
says  George  Otis,  Director  of  the  United  States  Geological  Survey,  in  his  annual  report,  made  public 
to-day. 

In  the  last  four  and  a  half  years  forty-one  geologists  have  left  the  Government,  primarily  to 
better  their  financial  condition.  The  salaries  they  received  from  corporations  averaged  nearly  two 
and  one-half  times  the  salaries  paid  them  by  the  Geological  Survey,  says  the  Director. 

Statement  by  George  von  L.  Meyer,  former  United  States  Secretary  of  the  Navy,  as  reported 
in  an  article  published  in  the  Sunday  Magazine  of  the  New  York  Tribune,  February  2,  1913: 

I  hope  to  see  the  prominent  and  successful  men  in  public  life  in  this  country  in  the  future 
look  for  private  secretaries  among  college  graduates,  because  in  that  way  they  can  find  men  specially 
prepared  and  equipped.  But  there  can  be  no  doubt  of  the  fact  that  the  great  majority  of  government 
salaries  are  inadequate  and  that  they  are  not  particularly  attractive  to  ambitious  and  energetic  young 
men  who  are  capable  of  great  things. 

Statement  by  Henry  L.  Stimson,  former  United  States  Secretary  of  War,  as  reported  in  an 
article  published  in  the  Sunday  Magazine  of  the  New  York  Tribune,  February  2,  1913: 

The  purely  monetary  rewards  and  opportunities  of  the  government  will  never  be  so  great  as 
those  offered  in  the  business  and  professional  world  elsewhere;  and  if  the  government  service  is  to 
be  maintained  upon  a  high  and  increasing  level  of  proficiency,  it  must  meet  competition  from  other 
quarters  by  some  compensating  features  that  will  attract  the  best  talent  to  its  service  and  retain  it. 

Statement  by  John  C.  Black,  former  President  of  the  United  States  Civil  Service  Commission, 
as  reported  in  an  article  in  the  Sunday  Magazine  of  the  New  York  Tribune,  February  2,  1913 : 

Government  employees  who  make  good  in  scientific  work,  and  even  in  clerical  and  executive 
work  for  the  government,  can  always  command  better  salaries  outside  the  public  service,  and  outside 
corporations  are  constantly  looking  for  such  men  who  have  shown  special  efficiency. 

Article  in  the  New  York  Tribune,  Sunday  Magazine  Section,  February  2,  1913: 

The  son  of  a  particular  friend  of  Charles  Nagel,  Secretary  of  Commerce  and  Labor,  came  to 
him  two  years  ago  and  asked  him  for  a  job. 

"I'll  give  you  this  job,"  said  Mr.  Nagel ;  "but,  in  return  for  it,  I  want  your  solemn  promise  that 
twelve  months  from  to-day  you  will  lay  your  resignation  upon  my  desk.  In  that  way  you  will  make 
sure  of  not  hopelessly  burying  yourself." 

The  young  man  kept  his  promise,  resigned  at  the  end  of  the  year,  and  a  little  later  secured  a 
good  position  in  private  life,  one  carrying  the  assurance  that,  if  he  worked  hard,  he  would  go  higher 
and  higher  in  the  business. 

In  a  vein  similar  to  Mr.  Nagel's,  Champ  Clark,  Speaker  of  the  House  of  Representatives,  once 
said  to  a  young  man  from  his  district,  "My  boy,  you  can  do  better  for  yourself  by  going  back  to  the 

74 


woods  at  home  and  mauling  rails  than  by  taking  a  clerkship  under  the  government.    You'll  get  no  job 
from  me." 

Statement  by  Frank  H.  Hitchcock,  Former  Postmaster  General  of  the  United  States,  as  re- 
ported in  an  article  published  in  the  Sunday  Magazine  of  the  New  York  Tribune,  February  2,  1913 : 

He  who  intends  to  make  his  work  for  the  government  a  life-work  must  decide  to  endure  great 
sacrifices  financially.  After  a  man  has  reached  or  passed  a  certain  degree  of  efficiency  and  responsi- 
bility in  the  service,  he  finds  that  he  gets  less  money  for  it,  far  less  money,  than  is  paid  by  business 
concerns  for  relatively  the  same  work.  I  should  say  that  he  discovers  that  he  is  working  for  at  least 
one-fourth,  perhaps  one-fifth,  of  what  he  could  be  making  on  the  OjUtside.  And  this  is  specially  true 
because  a  man  who  does  responsible  work  for  the  government  is  part  of  the  biggest  business  concern 
in  the  world.  He  has  to  learn  how,  and  know  how,  to  handle  tremendous  problems,  to  become  a 
trustworthy  part  of  the  gigantic  system.  He  is  taught  to  develop  and  exercise  his  judgment,  and  his 
self  reliance  must  necessarily  increase  as  he  discharges  his  duties.  Nevertheless,  with  all  this  equip- 
ment and  ability,  his  salary  does  not  rise  proportionately.  He  recognizes  that  he  could  be  making  more 
money  in  other  lines  of  endeavor. 

(A  merican — Editorial) 

From  an  article  reprinted  in  the  Congressional  Record,  October  31,  1913,  pp.  6517  ff : 
To  have  and  to  hold  a  Federal  position  in  Washington  is,  in  most  instances,  to  mortgage  one's 
better  prospects  and  potentialities  in  the  boundless  world  of  independent  endeavor  for  the  temporary 
possession  of  a  place  easy  to  fill  and  the  rewards  of  which  allure  because  they  are  never  disappointing 
in  their  regularity. 

Working  for  Uncle  Sam,  which  at  first  is  a  vocation,  oftentimes  becomes  a  disease,  and  an  in- 
curable one.  The  saddest  plaint  one  ever  hears  in  Washington — sadder  than  the  wail  of  the  rejected 
office  seeker — is  that  of  the  helpless  and  hopeless  Government  clerk  lamenting  his  unhappy  lot.  He  re- 
alizes that  he  is  "in  bad,"  and  yearns  for  one  more  chance  to  right  himself.  He  is  in  the  net  and  can 
not  escape.  He  should  like  to  extricate  himself,  but  that  is  impossible.  Perhaps  his  head  has  whit- 
ened and  his  hands  have  palsied  in  the  service,  and  his  years  of  steady  employment  are  unrepresented 
by  a  dollar  saved.    His  fate  is  sealed. 

The  departments  of  Washington  teem  with  professional  men  who  are  afraid  to  cut  loose  from 
a  sure  thing  with  the  Government,  be  it  ever  so  humble,  to  try  earning  a  livelihood  at  the  thing  for 
which  they  are  better  adapted  or  for  which  they  have  qualified  after  years  of  preparation ;  but  they 
have  shrunk  into  moral  and  intellectual  cowardice.  Conscious  of  strength  for  higher  altitudes,  they 
strain  and  fret  in  the  denser  atmosphere  of  the  monotonous  plains  of  Government  life  in  Washington. 
It  is  pathetic  to  behold  them — a  struggling,  heartless,  hopeless  mass. 

•  *  *  *  *  *  •  *>*  *  *  4r 

Then  there  is  the  reconciled  class  of  Government  clerks,  made  up  of  those  who  are  content  to 
drift  with  the  current  of  clerical  routine.  They  are  pursuing  the  lines  of  least  resistance.  The  Gov- 
ernment gait  is  easy-going — no  hurrying,  no  rushing,  very  humane  hours,  30  days'  vacation,  30  days* 
sick  leave,  two  pay  days  in  each  month.  "Oh,  what's  the  use  of  kicking?  Pretty  soft,  this,  after 
all.  Guess  I  will  stick  it  out."  So,  in  dourse  of  time,  the  reconciled  clerk  is  lost  in  the  great  ag- 
gregate. 

Certainly  there  are  hundreds  in  the  Government  service  in  Washington  that  make  good,  just 
as  there  are  hundreds  who  could  not  earn  as  much  compensation  for  their  labor  in  any  other  field. 
But  there  is  a  lamentable  disproportion  between  those  who  raise  themselves  above  the  level  of  medio- 
crity and  those  who  never  detach  themselves  from  the  undistinguished  mass.    When  one  clerk  climbs 

75 


to  the  loftiest  peaks  in  the  mountainous  range  of  successful  endeavor,  50  never  see  over  the  heads  of 
those  that  make  up  the  army  on  the  plains  below. 

The  percentage  of  young  men  who  have  used  a  position  in  the  departments  of  Washington  as 
a  stepping  stone  to  higher  things  is  pitiably  small.  Of  course,  some  have  "graduated"  from  the  de- 
partments to  places  out  in  the  world,  where  their  departmental  experience  was  converted  into  a  posi- 
tive help,  but  the  number  who  have  so  succeeded  forms  a  sad  and  disheartening  contrast  with  the  over- 
whelmingly larger  number  that  have  entered  the  departments  in  Washington  only  to  remain  in  ob- 
scurity. 

Saturday  Evening  Post,  September  13,  1913: 

Federal  salaries  have  not  been  systematically  revised  during  all  the  years  when  cost  of  living 
has  been  steadily  rising.  One  soulless  corporation  after  another  has  adopted  a  pension  scheme  for  its 
employees.  The  Government  has  none.  From  the  insufficient  data  at  hand  it  is  calculated  that  some- 
thing like  ten  thousand  injuries  to  Federal  employees  rise  every  year  from  industrial  accidents;  and 
in  compensating  the  victims  the  Government  lags  much  behind  the  standards  that  the  people  through 
legislative  action  have  enforced  upon  private  employers. 

*  *  **  *  *  *  *  *  *  *  * 

Doctor  Rubinow  reports  in  The  Survey  seventeen  fatalities  and  a  hundred  and  twenty-four  in- 
juries in  the  rural  mail  delivery  service,  and  eight  fatalities  and  four  hundred  and  forty  injuries  in 
city  mail  delivery — for  none  of  which  was  a  cent  of  compensation  paid.  Altogether  he  mentions  six- 
teen hundred  injuries,  three  hundred  and  ninety  of  them  fatal,  without  compensation! 

On  a  like  record  from  the  Steel  Trust,  the  halls  of  Congress  would  ring  with  denunciation — 
which  illustrates  again  that  the  Government,  though  very  free  with  advice  to  others,  will  not  conduct 
its  own  business  decently. 

Leslie's  Weekly,  March  6,  1913: 

There  are  many  *  *  *  able,  experienced  public  servants  *  *  *  who  will  have  to  drop  out 
because  of  the  change  in  administration  at  Washington.  Their  retirement  means  a  positive  loss  in 
dollars  and  cents  to  the  government.  It  is  a  costly  piece  of  business  to  train  new  men.  Too  great  a 
proportion  of  our  public  officers  are  content  to  be  rubber  stamps. 

From  address  by  Professor  Thomas  H.  Reed,  of  the  University  of  California,  at  the  Fifteenth 
Annual  Convention  of  the  League  of  California  Municipalities,  published  in  Pacific  Municipalities, 
February  1,  1913: 

Herein  lies  the  inferiority  of  our  public  service  to  that  of  other  countries  where  merit  appoint- 
ment and  good  behavior  tenure  prevail  for  all  offices,  and  to  the  service  of  private  corporations  whose 
self  interest  rigidly  forces  into  power  men  broadly  trained  and  tested  by  experience.  We  carefully 
select  a  clerk  in  the  assessor's  office,  whose  only  duty  is  to  drive  a  pen,  by  competitive  examination, 
and  then  give  the  responsible  work  of  the  assessor  to  an  amateur. 

The  Evening  Sun,  New  York,  January  30,  1913: 

*  *  *  Joseph  Powers,  who  works  at  Station  P,  which  is  situated  in  the  Produce  Exchange, 
hurt  his  back  and  was  laid  up  for  eleven  weeks  when  an  iron  stool  on  which  he  was  working  sorting 
mail  collapsed.  Powers's  pay  stopped  the  instant  he  struck  the  floor.  All  the  money  he  got  while  he 
was  off  duty  was  $8  a  week,  which  he  received  from  the  New  York  Letter  Carriers'  Association. 


76 


POLITICAL  ASPECT 
(Foreign — Official) 

Extract  from  Minutes  of  Evidence,  Second  Report  of  the  Royal  Commission  on  Civil  Estab- 
lishments, presented  to  British  Parliament,  1888: 

Sir  Thomas  Henry  Farrer,  Bart*.,  called  and  examined.        » 

20.012.  *  *  *  There  is  a  certain  difficulty  in  the  softheartedness  of  heads  of  departments 
and  of  ministers.  But  there  is  a  very  much  greater  difficulty  in  the  pressure  which  is  put  upon  them 
by  members  of  the  House  of  Commons.  That  is  the  real  difficulty;  the  real  difficulty  of  the  public 
service  is  getting  rid  of  bad  men,  and  the  real  difficulty  of  getting  rid  of  bad  men  is  that  no  minister 
will  face  the  pressure  which  is  put  upon  him  from  outside. 

20.013.  {Mr.  Hanbury.)  Have  you  had  much  personal  experience  of  that? — Yes,  I  have,  be- 
cause I  have  been  plagued  all  my  life  at  the  Board  of  Trade  with  inefficient  men  that  I  wanted  to  get 
rid  of,  but  have  been  unable  to  do  so. 

Debate  in  the  House  of  Commons  on  the  Telegraph  (Money)  Bill  {London  Times,  June  29, 
1907): 

Mr.  Buxton,  Postmaster  General :  When  the  charge  was  made  against  the  Post  Office  of  carry- 
ing on  a  telegraph  service  at  a  loss  his  withers  were  unwrung.  The  blame  should  really  fall  on  the 
shoulders  of  the  House  of  Commons,  to  whom  he  would  say,  if  he  could  address  it  as  an  individual, 
"Thou  art  the  man  t"  *  ♦  *  He  thought  it  was  only  fair  to  the  Post  Office,  and  it  might  be  rather 
advantageous  to  the  House,  that  they  should  know  who  was  the  real  culprit.  It  was  not  the  Post 
Office,  but  the  House  of  Commons.     Unfortunately  there  it  stood. 

************ 

Mr.  Austen  Chamberlain:  Said  *  •  *  he  did  not  think  that  when  it  (the  Post  Office) 
undertook  a  commercial  business  it  should  run  it  at  a  loss,  and  he  could  not  see  why  in  matters  of 
this  kind  the  tax  payer  should  be  expected  to  provide  a  service  for  the  minority  who  used  it  without 
exacting  in  return  some  reward  beyond  the  bare  interest  or  sinking  fund  of  the  capital. 

Hansard's  Parliamentary  Debates,  July  6,  1905,  pp.  1350  flf.: 

Lord  Stanley  (Postmaster-General)  said  the  demands  made  by  employees  generally  before  the 
Bradford  Committee,  with  the  pay  of  all  the  supervising  classes  raised  in  proportion  would  have  meant 
the  payment  from  the  Exchequer  of  no  less  than  £2,500,000  a  year.  He  was  entitled  to  ask  when 
was  this  to  cease.  Honorable  Members  knew  better  than  he  how  they  were  being  bombarded  with 
applications  from  Post  Office  employees  and  other  classes  of  Civil  Servants  for  increases  of  wages. 
This  had  taken  a  form  which  was  not  illegal,  but  which  he  could  not  help  thinking  was  an  abuse  of 
thdr  rights,  to  wit,  the  form  of  a  political  threat.  They  had  circulated  an  appeal  in  which  they  ex- 
pressed very  clearly  and  very  frankly  their  intention,  and  it  was  one  of  which  the  Committee  would 
have  to  take  note  now,  or  it  would  be  much  worse  in  the  future  •  ♦  *  it  was  abusing,  as  it  seemed 
to  him,  their  rights  as  voters.  It  was  nothing  more  nor  less  than  blackmail.  It  was  nothing  more 
nor  less  than  asking  Members  to  purchase  votes  for  themselves  at  the  General  Election  at  the  expense 
of  the  Public  Exchequer.  Both  sides  would  have  to  make  up  their  minds  that  some  means  should  be 
devised  by  which  there  should  not  be  this  continual  blood-sucking  on  the  part  of  the  public  servants. 

From  "The  British  State  Telegraphs,"  by  Hugo  R.  Meyer,  1907,  pp.  133-4: 
Before  the  Postmaster  General  had  introduced  into  Parliament  his  scheme  for  improving  the 
positions  of  the  telegraphists,  sorting  clerks  and  postmen.  Lord  Frederick  Cavendish,  in  his  position  as 

'Scrred  M  Pcrmannit  SccreUrjr  o(  the  Britiib  Board  of  Trade  froni  1867  lo  1886,  and  a*  member  of  the  Playfair  Commit- 
iiea  oa  the  Ciril  Serricc.  187«. 

77 


Financial  Secretary  of  the  Treasury,  had  written  the  Postmaster  General  as  follows ;  *  *  *  "The 
persons  who  are  affected  by  the  change  now  proposed  are,  as  you  observe,  no  fewer  than  10,000,  and 
the  entire  postal  service  numbers  nearly  five  times  as  many.  Other  branches  of  the  Civil  Service  em- 
ployed and  voting  in  various  parts  of  .the  United  Kingdom,  are  at  leaist  as  numerous  in  the  aggregate  as 
the  servants  of  the  Post  Office.  All  this  vast  number  of  persons,  not  living  like  soldiers  and  sailors 
outside  ordinary  civil  life  are  individually  and  collectively  interested  in  using  their  votes  to  increase,  in 
their  own  favor,  the  public  expenditure,  which  the  rest  of  the  community,  who  have  to  gain  their  living 
in  the  unrestricted  competition  of  the  open  market,  must  provide  by  taxation,  if  it  is  provided  at  all." 

From  "The  British  State  Telegraphs,"  by  Hugo  R.  Meyer,  1907,  pp.  234-235 : 

The  Chancellor  of  the  Exchequer,  Mr.  Austen  Chamberlain,  spoke  as  follows:  "The  question  at 
issue  was  not  one  between  the  two  political  parties.  It  was  above  parties.  It  was  whether  there  was 
to  be  good  economical  government  in  the  country  at  all,  or  whether  the  Civil  Servants  in  the  employ- 
ment of  the  Crown  could  make  such  use  of  their  votes,  as  citizens,  for  the  purely  selfish  purpose  of 
forcing  the  public  to  pay  more  for  their  services  and  so  increase  the  expenditure  of  a  great  Department 
of  State.  He  did  not  know  how  long  they  could  go  on  in  the  position  they  had  now  reached,  under 
which  pressure  was  brought  to  bear  on  Honorable  Members  of  all  parties  by  their  constituents.  He 
was  certain  that  if  any  scheme  could  be  devised  *  *  *  so  that  they  might  take  this  question  alto- 
gether out  of  the  region  of  political  life — not  merely  out  of  party  life,  but  out  of  Parliamentary  life — 
it  would  be  a  great  advantage.  It  would  tend  to  preserve  the  Civil  Service  free  from  that  political  in- 
fluence and  independent  of  the  changing  fortunes  of  party  which  had  been  their  great  boast  and  security 
in  the  past." 

From  "The  British  State  Telegraphs,"  by  Hugo  R.  Meyer,  1907,  pp.  305-306: 

Of  course  not  all  cases  of  intervention  by  Members  of  Parliament  are  as  successful  as  was  the 
intervention  of  Mr.  Bradlaugh,  which  resulted  in  the  promotion  of  eleven  men  out  of  fourteen  who 
had  been  passed  over  as  "not  qualified  for  promotion,"  or,  as  was  the  intervention  of  the  Member  of 
Parliament  whose  name  was  not  revealed,  which  brought  about  the  revocation  of  the  promotion  of  the 
ablest  man  in  the  Post  Office  at  Sheffield.  Indeed,  the  principal  effect  of  these  interventions  is  not  to 
force  the  Post  Office  to  retrace  steps  already  taken,  it  is  to  prevent  the  Post  Office  from  taking  certain 
steps.  These  interventions  modify  the  entire  administration  of  the  British  Post  Office.  They  compel 
the  Postmaster  General  and  his  leading  officers  to  consider  the  political  aspect  of  every  proposal  coming 
from  the  local  postmasters,  and  other  intermediate  officers,  be  it  a  proposal  to  promote,  to  pass  over,  to 
discipline,  or  to  dismiss. 

Statement  by  the  Hon.  R.  W.  Hanbury,  M.  P.  ("The  British  State  Telegraphs,"  by  Hugo  R. 
Meyer,  1907,  pp.  177-178) : 

Another  fact  which  Members  ought  not  to  overlook  was  the  political  pressure  which  was  far  too 
frequently  exercised  by  Civil  Servants  upon  those  who  also  represented  them.  That  was  a  great  and 
growing  danger.  It  was  chiefly  in  London  that  thi.s  pressure  was  brought  to  bear.  *  *  *  He  would 
give  an  instance  of  the  way  in  which  these  Civil  Servants  spoke  of  the  expediency  of  political  pres- 
sure. At  one  of  the  great  meetings  which  had  beer,  held,  a  speaker  said  there  were  8,000  postmen  in 
London,  and  that  he  hoped  every  one  would  have  his  name  upon  the  register  (of  voters),  so  that  at 
election  times  they  could  exercise  their  influence  upon  candidates  and  advocate  the  cause  of  higher 
wages.  He  was  of  the  opinion  that  political  pressure  ought  not  to  be  brought  to  bear  in  that  way. 
Ordinary  workmen  could  not  exercise  the  same  power,  but  Civil  Servants  could,  and,  whether  their 
agitation  succeeded  or  not,  their  position  was  secure,  so  that  it  was  a  case  of  "Heads,  I  win;  tails,  I 
don't  lose."  *  *  *  Before  the  Royal  Commission  (of  1888),  which  had  inquired  into  the  Civil 
Service  establishments,  evidence  was  given  with  regard  to  the  way  in  which  pressure  was  brought  to 
bear  in  certain  constituencies  upon  Members,  and  he  thought  that  the  almost  unanimous  feeling  of  the 
Commission  was  that,  if  this  state  of  things  continued,  it  would  be  necessary  to  disfranchise  the  Civil 
Service. 

78 


From  "The  British  State  Telegraphs,"  by  Hugo  R.  Meyer,  1907,  p.  305 : 

If  the  answer  given  by  the  Postmaster  General  is  unsatisfactory,  the  Member  of  Parliament 
gives  notice  that  he  will  bring  the  matter  up  again  on  the  discussion  of  the  Estimates  of  Expenditure. 
In  the  meantime  he  brings  to  bear,  behind  the  scenes,  what  pressure  he  can  command.  And  he  often 
learns  to  appreciate  the  grim  humor  of  the  reply  once  given  by  a  former  Minister  of  Railways  in  Vic- 
toria, Australia,  to  a  Victorian  Royal  Commission,  to  the  query  whether  political  influence  was  exer- 
cised in  the  administration  of  the  State  railways  of  Victoria.  The  reply  had  been :  "I  should  like  to 
know  how  you  can  have  a  politician  without  political  influence  ?" 

From  "The  British  State  Telegraphs,"  by  Hugo  R.  Meyer,  19U7,  pp.  139-140: 
Sir  Lyon  Play  fair,  who  had  been  Chairman  of  the  Royal  Commission  on  the  Civil  Service,  1874 
to  1876,  and  the  author  of  the  Playfair  Reorganization  of  the  Civil  Service,  1876,  testified  as  follows 
before  the  Royal  Commission  of  1888 :  "Unfortunately  Members  of  Parliament  yield  to  pressure  a 
great  deal  too  much  in  that  direction,  and  they  are  certainly  pressing  the  Exchequer  to  increase  the 
wages  and  salaries  of  the  employees  of  the  Crown.  *  *  *  In  a  private  establishment  a  man  looks 
after  his  own  interests,  and  if  a  person  came  to  him  and  said :  'Now  you  must  increase  the  salaries  of 
these  men  by  $100  or  $250  all  round,'  he  would  say :  'You  are  an  impertinent  man,  you  have  no  busi- 
ness to  interfere,'  but  you  cannot  say  that  to  Members  of  Parliament,  and  there  is  continual  pressure 
from  Members  of  Parliament  to  augment  the  salaries  of  the  civil  servants." 

Statement  by  D.  A.  Ross,  member  of  the  Manitoba  Legislature.  (Winnipeg,  Manitoba,  Free 
Press.  November  6,  1913)  : 

In  the  administration  of  all  the  public  utilities  of  the  province,  the  elevators,  the  telephones  and 
every  other  enterprise,  the  Roblin  government  have  contaminated  the  name  of  the  province  with  po- 
litical leprosy. 

{Foreign — Editorial) 

Winnip^,  Manitoba,  Free  Press,  June  15,  1912: 

It  is  matter  of  public  knowledge  that  the  telephone  system  has  from  the  beginning  been  run  as 
the  main  part  of  the  Government's  political  machine,  the  Commission  being  subjected  to  constant  in- 
terference and  control,  as  in  the  case  of  the  rate  reductions  on  the  eve  of  the  last  elections.  That 
particular  piece  of  Government  control  of  the  Commission  is  on  public  record,  in  the  statement  made 
by  the  chairman  of  the  Commission,  when  under  examination  before  the  Public  Accounts  committee 
of  the  L^slature. 

The  hiring  of  Manitoba  Government  Telephone  employees  has  been  on  political  lines,  the  Com- 
mission being  loaded  up  with  brigades  of  political  workers.  In  like  manner  the  hiring  of  rigs  and  the 
purchase  of  supplies  for  the  numerous  telephone  gangs  throughout  the  Provinc*  have  been  conducted 
on  political  lines. 

(American — Official) 

From  the  report  of  VV.  Q.  Gresham,  Postmaster  General  of  the  United  States,  year  1883,  p.  35 : 
The  establishment  and  operation  of  a  postal  telegraph  as  a  monopoly,  or  in  competition  with 
private  companies,  would,  it  is  insisted,  reduce  rates  which  are  now  exorbitant  and  protect  the  public 
against  the  abuses  and  evils  deemed  to  be  inseparable  from  the  service  as  it  exists.  In  either  event  an 
CBormous  expense  must  be  incurred.  But  without  dwelling  upon  that  consideration,  it  is  clear  that 
an  efficient  execution  of  either  plan  will  necessarily  involve  the  employment  of  a  multitude  of  opera- 
tors, messengers,  mechanics,  and  laborers,  and  thus  largely  add  to  the  patronage  of  the  Government. 
An  increase  of  that  patronage  beyond  what  is  indispensable  to  the  public  service  is  to  be  deprecated  and 
avoided,  and  it  is  one  of  the  dangers  which  threaten  the  purity  and  duration  of  our  institutions.  In 
Europe  the  telegraph  is  under  the  control  of  the  public  authorities.    With  us,  the  administration  is  the 

79 


Government  in  action,  and  may,  for  the  time  being  and  for  all  practical  purposes,  be  considered  the 
Government  itself.  In  seasons  of  political  excitement,  and,  to  some  extent  at  other  times,  is  there  not 
ground  for  serious  apprehension  that  the  telegraph,  under  the  exclusive  control  of  the  dominant  party, 
might  be  abused  to  promote  partisan  purposes  and  perpetuate  the  power  of  the  administration?  But  if 
it  could  be  kept  entirely  free  from  such  influence,  I  should  hesitate  to  sanction  a  measure  providing 
that  the  United  States  shall  become  the  proprietor  of  telegraph  lines,  and  operate  them  by  its  officers 
and  agents. 

Fitchburg,  Mass.,  Sentinel,  December  20,  1913: 

Former  Senator  Bourne  of  Oregon  is  quoted  in  a  Washington  dispatch  to  the  following  effect: 

"Senator  Bourne  states  that  he  has  not  a  dollar's  interest  in  telephone  or  telegraph  securities 
and  that  he  is  theoretically  in  favor  of  government  ownership,  though  practically  bitterly  opposed  to  it. 

"The  ex-Senator's  most  startling  deduction  is  that  government  ownership  would  result  eventually 
in  complete  domination  of  the  government  by  its  own  employees,  who  would  vote  themselves  such 
hours  and  pay  as  they  chose.     Mr.  Bourne  submits  the  following  figures : 

Number 

1911  Government  civil  employees 410,332 

1912  Telephone  employees 221,000       . 

1912     Telegraph  employees 40,000 

1911     Railway  employees 1,669,000 

1909     Electric  employees 209,729 

1904     Water  transportation 188,000 

1907     Express  companies 79,284 

Total 2,818,345 

Under  government  ownership  and  operation  there  would  soon  be  more  than  three  million  gov- 
ernmental employees,"  Mr.  Bourne  says.  He  continues :  "Taking  into  consideration  the  fact  that  in 
the  last  ten  presidential  elections  the  president  has  been  elected  by  a  plurality  varying  from  7,000  plus 
td  little  over  2,500,000,  the  thought  naturally  arises  that  three  million  governmental  employees  could 
absolutely  control  the  government  under  our  political  machinery,  the  tendency  being  more  pay,  less 
service  in  governmental  employment,  resulting  in  resistless  efforts  on  the  part  of  outside  labor  to  secure 
government  employment  because  less  onerous  and  more  remunerative,  with  accumulative  dissatisfaction 
and  irritation  in  all  private  enterprises." 

Congressional  Record,  January  15,  1914,  page  1753: 

Mr.  Moon  ;  *  *  *  You  are  drifting  rapidly  to  the  exercise  of  central  power.  If  you  shall 
adopt  the  policy  of  the  purchase  of  the  telegraphs  and  telephones,  you  will  have  proceeded  far  to  the 
federalization  of  power.  You  will  have  added  thousands  of  offices  to  your  Government.  If  you  should 
go  further  and  become  the  owners  of  the  railroads,  you  would  see  a  vast  army  of  people  who  would  be 
in  control,  a  Federal  menace  to  human  rights  and  human  liberty  under  a  Constitution  and  laws  in  which 
the  people  have  no  part  in  selecting  the  oflficers  to  administer. 

Washington,  D.  C.,  Post,  December  11,  1913: 

Senator  Bankhead,  of  Alabama,  chairman  of  the  Senate  committee  on  postoffices  and  post  roads, 
is  a  pronounced  opponent  of  government  ownership. 

"I  recognize  it  is  the  tendency  of  the  times,  but  it  is  a  dangerous  tendency,"  he  said.  "I  don't 
want  to  see  the  government  go  into  any  business  that  can  be  transacted  as  well  or  better  by  individual 
enterprise." 

From  The  American  Commonwealth,  (New  Edition,  1910,  Vol.  II,  Part  6,  Chapter  106,  Page 
701 ) ,  by  James  Bryce,  British  Ambassador  to  the  United  States : 

It  (j.  e.  the  railroad)  can  hardly  be  taken  over  and  worked  by  the  National  Government  as  are 
the  railways  of  Switzerland  and  many  of  those  in  Germany  and  the  Austro-Hungarian  monarchy.  Only 

80 


the  most  sanguine  state  socialist  would  propose  to  impose  so  terrible  a  strain  on  the  virtue  of  American 
politicians,  not  to  speak  of  the  effect  upon  the  constitutional  balance  between  the  States  and  the  Federal 
Authority. 

From  remarks  of  Senator  Joseph  R.  Bristow,  of  Kansas,  before  the  United  States  Senate  {Con- 
gressional Record,  August  29,  1913,  p.  4303)  : 

I  wanted  to  suggest  to  the  Senator,  by  his  permission,  that  there  is  a  wide  difference  between  the 
running  of  a  wholesale  house  and  the  administration  of  a  government  position.  The  Senator  knows 
well  that  the  man  in  control  of  a  wholesale  house  is  interested  in  the  development  of  a  business  for 
profit.  The  man  in  charge  of  a  political  office  in  Georgia  or  Kansas  or  any  place  else  is  appointed 
there,  if  it  is  outside  of  the  civil  service,  nine  times  out  of  ten  because  of  political  service  that  he  has 
rendered  to  members  of  the  party  in  power.  The  Commissioner  of  Internal  Revenue  is  not  free  to  go 
out  and  select  the  men  who  he  thinks  will  administer  the  office  better  as  is  the  man  in  charge  of  a 
business  concern ;  he  is  bound  by  political  obligations  and  ties.  Now,  we  may  theorize  all  we  please, 
but  that  the  Senator  from  Georgia  knows  to  be  a  fact. 

From  Preliminary  Report  of  the  Joint  Commission  on  Business  Methods  of  the  Post  Office  De- 
partment and  Postal  Service,  February  10,  1908: 

The  appointments  of  postmasters,  clerks  in  postoffices,  and  many  other  grades  of  the  service  are 
still  largely  affected  by  political  influence,  and  it  is  to  be  feared  that  nominations  made  have  often  in- 
sufficient regard  to  the  fitness  of  the  applicant,  to  his  previous  experience,  or  to  his  familiarity  with  the 
routine  of  the  postal  service.  Moreover,  the  frequent  changes  in  the  personnel  of  the  service  naturally 
operate  adversely  to  its  efficiency. 

As  compared  with  this  condition,  in  well-administered  commercial  concerns  promotion  is  by 
merit  alone,  no  other  influences  being  considered ;  and  the  different  parts  of  the  business  are  intrusted  to 
heads  thoroughly  familiar  with  the  whole  routine  work,  who  are  held  responsible  for  the  work  and  are 
given  practically  a  free  hand  in  the  selection,  promotion,  and  retention  of  their  subordinates. 

Congressional  Record,  January  20,  1914,  p.  2035: 

Mr.  Murdock:  *  *  *  Now,  I  do  not  take  much  stock  in  the  battle  that  has  raged  here  be- 
tween the  two  old  parties  about  civil  service.  It  is  a  resumption  of  the  ancient  and  diverting  game 
of  the  pot  and  the  kettle.  The  Republicans  say  that  the  Democrats  are  not  friendly  to  the  merit  sys- 
tem and  the  Democrats  say  that  the  Republicans  are  not  friendly  to  the  merit  system.  Both  of  them 
are  right. 

Congressional  Record,  January  19,  1914,  p.  1972: 

Mr.  McCumber:  •  ♦  •  Government  ownership  of  railways,  followed  by  Government  owner- 
ship, as  it  must  be,  of  other  public  utilities,  means  that  the  army  of  employees,  organized  as  they  always 
will  be,  will  become  the  complete  masters  of  the  Government  and  the  Govemm.  nt  but  the  subservient 
tool  to  the  interests  of  this  great  army.  That  army  will  be  powerful  enough  to  dictate  every  policy  of 
Government.  No  man  in  any  district  in  the  United  States  would  be  strong  enough  to  make  his  race  as 
a  Member  of  Congress  if  his  ideas  of  the  value  of  the  wages  of  these  Government  employees  did  not 
correspond  with  their  idea  of  the  worth  of  their  services.  Whenever  the  Government  puts  itself  in  the 
position  of  owner  of  public  utilities,  it  becomes  the  prey  oi  an  organized  class  of  people,  which  will 
result  in  legislation  against  the  mass  of  the  unorganized  people  of  the  country. 

Congressional  Record,  January  17,  1914,  p.  1958: 

Mr.  Campbell  :  Suppose  a  Republican  should  have  a  higher  grade  than  a  Democrat  for  the  same 
office,  then  what  would  you  do? 

Mr.  Cox  :  Ah.  I  have  had  to  go  up  against  that  ever  since  I  have  been  in  Congress,  I  am  sorry 
to  say,  where  Democrats  in  my  district  who  had  taken  rural-route  examinations  and  were  several  points 
the  highest  in  the  grade.    I  have  gone  down  to  the  Post  Office  Department  and  tried  to  get  them  to 

81 


appoint  the  Democrat,  but  was  told  that  some  Republican  referee  in  the  State  of  Indiana,  after  both 
Republican  United  States  Senators  were  defeated,  had  to  be  consulted,  and  their  orders  had  to  be 
obeyed ;  and  the  result  was  time  and  again  that  Democrats  failed  to  get  the  position,  although  holding 
the  highest  grade. 

From  the  Congressional  Record,  January  17,  1914,  p.  1959: 

Mr.  Cox  ;  *  *  *  I  mean  to  say  this,  for  the  third  and  last  time  that  I  am  going  to  say  it, 
that  if  I  have  any  control  or  any  voice  in  the  selection  of  persons  to  fill  positions  in  my  district  where 
a  competitive  examination  has  been  held,  that  if  a  Democrat  gets  on  the  eligible  register  he  is  going  to 
get  the  appointment. 

Congressional  Record,  January  17,  1914,  p.  1921 : 

Mr.  Post  :  I  want  to  give  the  gentleman  a  concrete  illustration  to  show  that  the  merit  system, 
as  it  has  been  administered  heretofore,  has  been  indeed  prostituted  to  politics.  In  the  city  of  Spring- 
field, Ohio — and  the  gentleman  is  familiar  with  that  city — we  have  a  post  office  where  there  are  107 
employees,  and  of  that  number  only  6  are  Democrats.  I  want  to  ask  the  gentleman  if  in  the  city  of 
Springfield,  in  the  application  of  the  merit  system,  that  office  has  not  been  prostituted  to  politics? 

*     *     * 

Right  here,  under  the  very  nose  of  the  Goddess  of  Liberty,  right  in  front  of  the  Capitol  here, 
in  the  Congressional  Library,  you  have  496  employees  under  the  civil  service,  and  less  than  50  of  them 
are  Democrats.  Have  you  not  prostituted  the  merit  system  to  politics  in  that  case?  Those  people 
are  there  under  a  Republican  administration. 

Congressional  Record,  January  17,  1914,  p.  1958: 

Mr.  Cox  ;  *  *  *  You  have  evolved  and  manufactured  a  new  definition  of  the  merit  system 
which  has  been  a  political  merit  system.  By  a  political  pull  it  has  found  its  way  into  the  appointment 
of  civil-service  employees  so  that  you  have  filled  practically  every  department  with  Republican  em- 
ployees at  home  and  abroad,  the  exceptions  being  indeed  very  few.  You  have  paid  no  attention  to 
merit,  ability,  intelligence,  education.  These  things  were  wholly  unknown  to  you  in  your  appointments. 
You  were  governed  solely  and  exclusively  by  the  political  rule  of  political  expediency ;  you  have  ap- 
plied this  test  faithfully;  have  never  faltered  or  fallen  by  the  side  along  this  line.  Out  of  1,900  rural 
route  carriers  in  the  State  of  Indiana  to-day  I  assert  it  to  be  a  true  fact,  for  I  have  investigated  it,  that 
less  than  5  per  cent,  of  this  1,900  rural  route  carriers  are  Democrats;  the  remainder  were  Republicans 
when  appointed  and  Republicans  to-day,  and  were  it  not  for  encumbering  the  Record  I  would  place  in 
it  a  volume  of  correspondence  from  82  of  the  92  counties  in  my  State  conclusively  showing  this  con- 
dition to  be  true. 

Congressional  Record,  January  17,  1914,  p.  1950: 

Mr.  Steenerson  :  *  *  *  The  gentleman  from  Tennessee  predicted  dire  results  to  the  Govern- 
ment and  the  people  if  postal  activities  should  be  extended  to  telegraphs  and  telephones.  I  do  not  think 
we  are  ready  for  that.  Certainly  not  as  long  as  the  spoils  system  in  the  Civil  Service  remains  a  debated 
issue. 

From  the  Congressional  Record,  January  17,  1914,  p.  1959: 

Mr.  Cox  ;  *  *  *  i  have  seen  school-teachers  in  Indiana  carrying  a  two-years'  license — and 
this  requires  considerable  of  an  education  in  Indiana  before  one  can  earn  a  two-years'  license — I  have 
seen  them  stand  civil-service  examinations  for  rural-route  carriers  side  by  side  with  ward  politicians, 
men  with  practically  no  education  whatever,  and  yet  invariably  the  ward  politician  received  the  job. 

Congressional  Record,  January  17,  1914,  p.  1916: 

Mr.  Kahn  :  *  *  *  I  am  not  surprised  at  the  attitude  of  the  gentlemen  on  the  Democratic 
side  of  this  House.  The  pressure  for  place  is  undoubtedly  very  great.  Your  Democratic  constituents 
are  demanding  their  reward.    They  want  the  jobs.     They  insist  on  their  pound  of  flesh.    Not  alone  are 

82 


the  civil-service  positions  sought  for,  but  various  executive  chiefs  have  demanded  the  resignation  of 
postmasters,  United  States  marshals,  district  attorneys,  and  other  Federal  employees,  even  though  those 
officials  still  had  two  or  three  years  to  serve  under  their  commissions.  Happily  some  of  these  men  have 
had  the  backbone  and  the  courage  peremptorily  to  refuse  to  surrender  their  commissions  and  to  demand 
that  their  official  conduct  be  investigated,  to  find  out  why  they  should  be  removed  from  office. 

Congressional  Record,  January  17,  1914,  p.  1908: 

Mr.  Rucker  :  ♦  *  *  There  are  Democrats  growing  up  in  the  country  everywhere  who  are 
entitled  under  a  Democratic  administration  to  recognition ;  and  if  that  means  going  back  to  the  spoils 
system,  then  I  am  a  spoilsman  and  I  have  no  apology  to  make  foi*  it.     (Applause.) 

Congressional  Record.  January  17,  1914,  p.  1906: 

Mr.  Borland:  ♦  *  *  It  has  been  my  experience  and  observatiaon  that  not  only  was  the 
postmaster  named  by  some  political  officer  in  authority  for  political  purposes  and  named  without  any 
special  regard  to  his  experience  in  that  post-office  business,  but  that  same  authority  named  also  the 
assistant  postmaster,  and  without  consultation  with  the  postmaster.  And  not  only  that,  but  it  has 
frequently  happened,  I  will  say  to  my  friend  from  Indiana  (Mr.  Bamhart),  that  the  assistant  post- 
master was  named  from  the  faction  of  the  party  that  did  not  happen  to  land  the  postmaster.  I  have 
known  of  cases — and  I  have  no  doubt  my  friend  has,  too — where  they  not  only  did  not  work  in  har- 
mony, but  where  they  did  not  trust  each  other  personally,  and  I  have  always  regarded  it  as  a  political 
blunder,  if  no  worse,  to  put  those  men  under  political  appointment. 

Congressional  Record,  January  17,  1914,  p.  1^7: 

Mr.  Cooper:  Is  it  not  true  that  under  the  policy  or  practice  suggested  by  the  question  of  the 
gentleman  from  Missouri  (Mr.  Rucker)  assistant  postmasters  were  appointed  in  this  way:  The 
Member  of  Congress  wanted  it  understood  that  if  John  Smith  was  appointed  postmaster  it  was 
done  upon  the  express  condition  that  John  Brown  should  be  the  assistant  postmaster,  and  that  in 
many  cases  the  postmaster  had  to  ag^ee  to  that  before  he  could  get  the  appointment,  and  in  that  way 
the  Congressman  fixed  up  a  part  of  his  own  machine? 

Mr.  Rucker  :    That  is  exactly  what  I  would  do  in  every  case,  and  I  have  no  apology  for  it. 

Mr.  Borland:  It  would  be  bad  enough  under  the  old  conditions;  but  under  the  altered  condi- 
tions, since  the  Post  Office  Department  has  become  distinctly  a  business  institution,  there  is  no  justifi- 
cation whatever  for  appointing  these  men  for  political  purposes. 

Congressional  Record,  January  17,  1914,  p.  1956: 

Mr.  Cox :  *  •  *  On  September  30,  1910,  President  Taft  by  an  Executive  order  turned  into 
the  civil  service  approximately  2,400  assistant  postmasters.  Of  these  2,400  assistant  postmasters  less 
than  500  of  them  had  ever  been  subjected  to  or  had  ever  stood  a  written  competitive  examination. 

The  remainder  of  them,  1,900  in  number,  had  beyond  dou^t  been  appointed  to  their  respective 
positions  solely  and  exclusively  because  of  their  peculiar  fitness  politically. 

Congressional  Record,  January  17,  1914,  p.  1956: 

Mr.  Cox:  *  •  ♦  We  have  had  in  this  country  a  "pretended"  civil  service  for  the  last  30 
years  or  more.  I  call  it  "pretended"  civil  service  because  that  is  all  it  is,  all  it  ever  was,  and  all  it 
ever  will  be  until  the  Civil  Service  Commission  amends  its  rules  and  regulations  in  regard  to  certifying 
eligibles  who  have  passed  a  civil-service  examination.  Talk  to  me  about  merit  system  all  you  please. 
We  do  not  have  merit  system  under  civil  service,  never  have  had,  and  never  will  have  until  the  rules 
and  r^ulations  of  the  commission  are  amended  so  as  to  make  it  strictly  a  merit  system.  The  trouble 
with  the  civil-service  system  as  it  is  administered  to-day,  in  my  judgment,  is  that  you  give  a  leeway 
for  any  and  all  persons  and  parties  to  play  "football"  with  it,  and  the  Republican  Party  for  16  years 
has  played  "football"  with  it  under  the  leeway. 

83 


Congressional  Record,  January  17,  1914,  p.  1907: 

« 

Mr.  Borland  :  *  *  *  I  do  not  even  believe  those  men  are  appointed  in  all  cases  for  party 
service.  I  believe  they  are  often  appointed  for  service  to  some  political  officeholder  who  has  the  rec- 
ommendation of  their  appointment. 

Mr.  Rucker  :     The  gentleman  ought  not  to  go  that  far. 

Mr.  Borland:    I  will  go  that  far. 

Mr.  Borland:  I  say  that  they  are  appointed  not  necessarily  for  party  services,  distinguished 
as  such,  nor  because  their  views  upon  party  questions  are  sound,  and  would  appeal  to  the  mass  of 
the  voters  in  their  district  if  they  were  candidates  for  an  elective  office;  but  they  are  appointed  be- 
cause they  have  been  politically  useful  to  the  man  who  recommends  their  appointment.  Why,  they 
may  not  have  been  serving  the  party.  They  may  have  been  serving  only  a  faction.  They  may  have 
served  only  a  political  boss  or  leader.  (Applause.)  I  object  to  either  the  postmaster  or  the  assistant 
postmaster  being  made  the  official  whip  cracker  over  the  heads  of  the  men  in  the  classified  service,  in 
the  interest  of  either  party,  faction,  or  boss.     (Applause.) 

Congressional  Record,  January  17,  1914,  p.  1957: 

Mr.  Switzer:    How  will  you  do  in  Indiana? 

Mr.  Cox:  Exactly  as  you  have  played  politics  and  "football"  with  the  civil-service  law  for  16 
years ;  I  propose  to  turn  the  tables  on  you  and  do  exactly  as  you  have  done ;  and,  so  far  as  your  State 
is  concerned,  I  take  it  that  if  a  Democrat  gets  on  the  eligible  register  there  will  be  enough  warm 
Democratic  blood  in  the  members  of  this  House  from  the  State  of  Ohio  to  see  to  it  that  Democrats 
are  appointed. 

Mr.  Switzer:     Then  you  are  not  going  according  to  the  civil-service  policy? 

Mr.  Cox  :  Yes ;  we  are.  We  will  be  administering  it  exactly  as  the  civil-service  policy  was 
administered  by  you  and  your  party  ever  since  you  have  been  in  power,  and  that  is,  see  to  it  that 
every  time  a  Democrat  wins  out  in  the  written  competitive  examination,  if  he  goes  on  the  eligible 
register,  see  to  it  that  he  gets  the  position. 

Congressional  Record,  January  17,  1914,  pp.  1957-8: 

Mr.  Cramton  :  And  thereby  you  have  admitted  that  your  party  is  to-day  playing  football  with 
the  civil  service? 

Mr.  Cox  :  This  is  exactly  what  you  have  done  with  the  civil-service  law  for  the  last  16  years, 
and  you  know  it  to  be  true,  and  you  cannot  blame  the  Democratic  Party  for  retaliating  in  self-defense. 

Mr.   Cramton  :     Never  mind  your  reason ;  but  you  admit  you  are  doing  it. 

Mr.  Cox  :  Whether  you  call  it  playing  football  or  not,  by  your  own  example  you  have  set 
the  pace,  and  if  we  turn  the  trick  on  you,  you  should  not  blame  us.  I  am  a  partisan ;  of  course  I  am, 
and  frankly  state  to  you  that  if  a  Democrat  gets  on  the  eligible  register  for  fourth-class  postmaster 
he  is  going  to  get  the  appointment  if  I  can  aid  him  in  so  doing. 

Congressional  Record,  January  17,  1914,  p.  1958:  , 

Mr.  Cox  ;  *  *  *  Now,  in  response  to  queries  from  gentlemen  on  the  Republican  side,  let 
me  give  you  an  instance  as  to  how  you  have  played  football  in  the  past  with  public  offices.  I  had 
a  Republican  friend  two  years  ago  who  wanted  to  be  reappointed  postmaster  in  my  district,  and, 
being  a  member  of  the  Committee  on  the  Post  Office  and  Post  Roads,  I  thought  I  might  give  him 
some  little  influence  with  Postmaster-General  Hitchcock.  I  called  upon  the  General,  and  was  told  by 
him  that  the  little  post  office  in  a  little  town  of  about  2,500  was  on  the  auction  block  and  that  if  the 
postmaster  could  deliver  the  delegates  to  the  district  meeting  that  would  select  the  delegates  to  attend 
the  national  convention  he  could  receive  the  appointment.  I  informed  my  friend  by  letter,  and  he  car- 
ried out  my  orders  to  a  certain  point,  but  failed  to  carry  them  out  to  the  final  conclusion,  and  the 
result  was  that  he  did  not  get  that  post  office. 

84 


Mr.  Switzer:    What  was  the  highest  bid? 

Mr.  Cox  :    The  bid  was  for  the  nomination  of  the  Republican  President  in  1912. 

A  Member:    Who  told  you  that? 

Mr.  Cox  :    Mr.  Hitchcock. 

Congressional  Record,  January  17,  1914,  p.  1959: 

Mr.  Fess:  Do  I  understand  that  it  does  not  matter  what  the  regulation,  the  gentleman  is 
opposed  to  civil  service  on  the  merit  system? 

Mr.  Cox:  No;  I  am  opposed  to  the  way  in  which  you  have  administered  it,  or  your  party 
rather. 

Mr.  Fess  :    Then  why  does  the  gentleman  not  endeavor  to  Administer  it  differently  ? 

Mr.  Cox :     Because  partisans  will  administer  it  in  a  partisan  way. 

Congressional  Record,  January  17,  1914,  p.  1958: 

Mr.  Cox  :  I  am  not  quarreling  with  the  Civil  Service  Commission.  I  imagine,  so  far  as  the 
examining  of  the  papers  are  concerned,  it  is  fair;  but  you  have  had  an  underground  tunnel,  a  sub- 
terranean passage,  whereby  in  some  way  or  manner  the  Democrats  in  my  part  of  the  country  have 
had  no  show  on  earth;  and  this  became  so  obnoxious  out  in  Indiana  several  years  ago  that  bright, 
active,  intelligent  young  men — Democrats — flatly  refused  to  go  forward  and  stand  examinations. 

Speech  of  Representative  Moon,  Chairman  of  the  Committee  on  Post  Offices  and  Post  Roads, 
published  in  the  Congressional  Record,  January  15,  1914,  pp.  1750-51 : 

Mr.  Moon  :  *  ♦  •  There  are,  I  believe,  2,560  assistant  postmasters  in  the  United  States.  If 
they  had  been  properly  examined  and  placed  under  the  civil  service,  would  98  per  cent,  of  them  have 
been  Republicans?  No;  it  could  not  have  been  so.  And  yet  that  is  the  practical  fact.  If  those 
43,000  men  in  the  fourth-class  offices  had  been  examined,  would  95  per  cent,  of  them  have  been  Repub- 
licans?   Gentlemen,  you  know  how  easily  it  is  done.    You  know  the  manner  of  examination. 

I  refer  to  these  matters  to  show  you  that  the  examinations  are  never  just  what  they  ought  to 
be.  They  may  not  always  be  fraudulent,  but  tliey  arc  not  examinations  for  the  purpose  of  .ittaining  an 
efficiency  record.  They  are  examinations  controlled  by  favoritism  and  prejudices.  What  is  the  result 
of  the  examination?  How  is  it  that  all  of  these  Republicans  get  into  office  and  no  Democrats ?  The 
examination  is  certified  to  the  department ;  the  three  men,  in  the  opinion  of  the  examiners,  that  made 
the  best  grade  arc  placed  upon  the  eligible  list.  There  may  have  been  one  Republican  and  two 
Democrats  who  passed,  or  it  may  have  been  the  opposite;  but  the  Congressman,  if  a  Republican  from 
that  district,  is  called  upon  to  say  which  one  of  the  three  shall  have  the  office,  and,  of  course,  gives  it 
to  a  member  of  his  party.  I  do  not,  from  a  partisan  standpoint,  blame  him.  But  if  the  examination  is 
held  for  the  purpose  of  efficiency  in  the  public  service,  there  would  be  no  question  about  the  fact  that, 
if  it  had  been  honest  and  fair,  the  man  who  obtained  the  highest  grade  would  obtain  the  office. 

Congressional  Record,  January  15,  1914,  p.  1758: 

Mr.  Copley:  *  ♦  •  In  the  spring  of  1909  the  Legislature  of  the  State  of  Illinois  was  trying 
to  elect  a  United  States  Senator,  and  at  one  time  I  counted  in  Springfield,  the  capital  of  that  State, 
the  city  where  the  L^slature  met,  168  Federal  employees,  all  there  for  the  purpose  of  trying  to  bring 
about  the  re-election  of  a  man  to  whom  they  were  under  obligation  for  the  generous  salaries  which 
they  enjoyed  and  whose  term  expired  forever  March  4,  1909. 

Many  of  these  employees  spent  months  in  a  vain  effort  to  continue  that  policy,  which  had  proven 
so  obnoxious  to  the  people  of  the  State  of  Illinois. 

From  the  18th  Annual  Report  of  the  Cook  County,  Illinois,  Civil  Service  Commission,  1913 : 

During  the  preparation  of  the  current  budget  the  Finance  Committee,  at  the  urgent  request  of 
the  heads  of  departments,  increased  the  salaries  of  several  of  the  "old  and  faithful  employees,"  whose 

85 


services  were  described  as  "indispensable  to  the  office."  In  February,  1913,  when  the  Supreme  Court 
declared  the  Civil  Service  Act,  covering  these  positions,  to  be  invalid,  the  department  heads  were  pow- 
erless to  save  these  "indispensable  employees"  who  were  swept  away  and  their  places  taken  by  persons 
named  from  "outside"  by  the  ward  leaders.  In  one  instance,  an  excellent  teamster  was  named  and 
forcibly  appointed  a  stenographer.  In  another  instance,  a  saloonkeeper,  of  undoubted  parts  in  the 
liquor  business,  was  made  a  clerk  and  his  duties  subsequently  abolished  to  save  the  office  books  from 
ruin.  In  another  case,  a  flat  building  janitor  became  a  tax  clerk.  At  least  thirty  of  the  politically 
appointed  county  employees  are  pluralists  on  the  pay  rolls  of  the  state,  city  or  park  districts.  Nine  of 
them  are  members  of  the  State  Legislature. 

Congressional  Record,  October  10,  1913,  p.  6235: 

Mr.  Clark:  *  *  *  i  am  opposed  to  the  whole  civil-service  propaganda.  (Applause.)  I 
am  opposed  to  it  because  I  believe  it  is  hypocritical,  insincere,  and  fraudulent  in  its  every  aspect,  and, 
as  my  friend  at  my  right  suggests,  damnable.  Mr.  Speaker,  I  am  opposed  to  it  because  I  believe  with 
Andrew  Jackson  that  to  the  victor  belongs  the  spoils. 

Extract  from  one  of  the  speeches  of  Theodore  Roosevelt  (published  in  the  biography  of  the  latter 
by  Jacob  A.  Riis)  : 

We  hear  much  of  the  question  whether  the  government  should  take  control  of  the  telegraph  lines 
and  railways  of  the  country..  Before  that  question  can  be  so  much  as  discussed,  it  ought  to  be  definitely 
settled  that  if  the  government  takes  control  of  either  telegraph  line  or  railway  it  must  do  it  purely  to 
manage  it  as  a  business  undertaking  and  must  manage  it  as  a  service  wholly  unconnected  with  politics. 
I  should  like  to  call  the  special  attention  of  bodies  interested  in  increasing  the  sphere  of  state  action — 
interested  in  giving  the  state  control  more  and  more  over  railways,  over  telegraph  lines  and  over  other 
things  of  the  sort — to  the  fact  that  the  condition  precedent  upon  success,  is  to  establish  an  absolutely 
non-partisan  system.  When  that  point  is  once  settled,  we  can  discuss  the  advisability  of  doing  what 
these  gentlemen  wish,  but  not  before. 

Report  on  Lewis  Publishing  Co.  and  Various  Lewis  Enterprises,  by  the  House  Committee  on 
Expenditures  in  the  Post  Office  Department  (House  Report  No.  1601),  March  1,  1913: 

For  nearly  seven  years  the  Government  of  the  United  States,  through  the  Post  Office  Depart- 
ment and  the  Department  of  Justice,  has  been  almost  continuously  prosecuting  Mr.  E.  G.  Lewis  or  the 
various  enterprises  with  which  he  has  been  connected.  *  *  *  Every  effort  that  the  organized  power 
of  two  great  departments  could  exert  has  been  used  at  enormous  expense.  As  a  result  several  large 
business  concerns  managed  by  Mr.  Lewis  have  been  ruined,  among  them  the  People's  United  States 
Bank,  the  Lewis  Publishing  Co.,  and  the  University  Heights  Realty  and  Development  Co. ;  many  hun- 
dreds of  small  investors  have  lost  their  savings ;  and  the  sad  example  has  been  shown  the  world  of  the 
powers  of  a  great  Government  exerted  successfully  in  an  effort  to  ruin  a  single  individual,  and  yet  he 
has  not  been  convicted  of  any  violation  of  law. 

*        *        * 

William  A.  Ashbrook, 
Joshua  W.  Alexander, 
William  C.  Redfield, 
Walter  I.  McCoy. 

(American — Editorial) 

Utica,  N.  Y.,  Press,  December  22,  1913 : 

Government  ownership  of  the  telephone  and  telegraph  lines  has  not  worked  out  successfully 
where  it  has  been  tried.  Here  in  this  country  it  would  increase  the  army  of  federal  office  holders, 
helping  those  who  are  in  to  stay  in  and  then  when  a  change  came  there  would  be  a  general  ousting 
of  trained  and  competent  employees  to  make  way  for  untried  and  incompetent  people  who  had  a  polit- 
ical pull;  and  there  is  too  much  of  that  already  vvilhout  going  into  it  more  extensively. 

86 


Philadelphia,  Pa.,  Press.  December  22,  1913 : 

Patronage  in  Government  appointments  is  inconsistent  with  efficiency  and  has  been  in  the  past 
one  of  the  greatest  of  public  evils.  Civil  service  reform  seeks  to  get  rid  of  this  evil  and  under  our 
latest  Administrations  very  largely  succeeded.  That  reform  is  now  discredited  and  the  spoils  system 
is  again  in  partial  operation.  While  this  lasts  certainly  it  will  be  no  time  to  add  another  great  army 
of  employees  to  the  public  service.  If  the  Government  shall  ever  assume  the  new  responsibilities  it 
should  be  only  when  merit,  skill  and  experience  are  secure  in  service  independent  of  the  outcome  of 
popular  election. 

Burlingtpn,  Vt.,  Free-Press,  December  20,  1913 :  « 

Would  it  be  good  for  the  country  or  for  the  employees  themselves  to  be  thrown  into  politics  ? 
Would  it  make  the  likelihood  of  a  fair  voice  in  elections  greater  to  have  this  vast  addition  to  the  mul- 
titudes of  federal  office  holders?  Would  it  make  the  task  of  governing  easier  to  have  all  the  necessary 
additional  work  laid  upon  the  National  Government?  The  wheels  of  Government  creak  a  little  already 
with  the  burden  we  put  upon  them.  If  we  make  the  Government  try  to  act  so  entirely  beyond  its  sphere, 
where  are  we  to  end  ?    Will  it  not  be  demoralizing  as  well  as  expensive  ? 

Torrington,  Ct.,  Register,  December  20,  1913: 

It  may  also  be  said  that  the  control  of  the  wires  by  the  Government  would  be  a  precursor  of 
conditions  such  as  exist  in  France  where  the  labor  organizations  have  the  telegraph  and  telephone  em- 
ployees of  the  Government  in  their  fellowship  and  thus  have  the  Government  in  important  respects 
under  their  thumb. 

Ft.  Wayne,  Ind.,  Ne-ws,  December  19,  1913: 

Let  all  public  utilities  be  Government  owned,  and  we  find  the  country  in  control  of  an  office 
holding  class,  a  class  that  is  able  to  operate  the  Government  in  its  own  interests  and  which  does  not 
hesitate  to  do  so.  Nothing  is  as  thoroughly  conducive  to  National  decay  as  a  Government  dominated 
and  controlled  by  an  office-holding  class.  Of  necessity  this  class  becomes  parasitical  as  it  increases  its 
power  and  at  the  same  time  its  efficiency  declines.  Its  sole  object  appears  to  be  to  obtain  the  piaximum 
compensation  for  a  minimum  service,  and  to  saddle  itself  upon  the  country  like  the  old  man  of  the  sea. 

Asbury  Park,  N.  J.,  Times,  Deceml)er  19,  1913: 

If  the  merit  system  were  employed  in  the  Government  service  in  practice  as  it  is  in  principle, 
it  might  be  proj>cr  to  supply  an  efficient  army  of  employees  to  man  this  gigantic  enterprise,  but  this  is 
impossible.  Conditions  in  the  postal  system  are  more  nearly  perfect  than  in  any  other  under  Govern- 
ment r^ulation,  but  even  here  the  most  desirable  offices  are  filled  by  {)oliticians. 

Philadelphia,  Pa.,  Inquirer,  December  19,  1913: 

Most  of  the  telegraph  offices  of  the  country,  though  not  the  larger  ones,  are  in  charge  of  railway 
operators.  If  these  were  sworn  into  the  Government  service  it  would  not  be  satisfactory  to  the  rail- 
ways, for  the  employees  would  naturally  obey  regtdations  of  the  Washington  administration.  There 
would  arise  a  body  of  Federal  officials  enormous  in  its  extent  and  larger  in  number  than  all  in  the 
service  to-day.  What  these  might  effect  as  a  political  organization  could  not  be  predetermined,  but  we 
may  be  pretty  sure  that  it  would  be  an  important  factor. 

New  York  Telegraph,  December  13,  1913: 

Another  danger  lies  in  the  fact  that  a  mighty  army  of  civil  service  employees  would  be  added 
to  the  Federal  payroll.  They  would  clamor  for  a  higher  wage — and  get  it.  And  if  the  time  ever  should 
come  when  a  majority  of  the  voters  of  this  country  are  beneficiaries  of  the  public  treasury,  directly  or 
indirectly,  then  the  party  in  power  will  be  self -perpetuating. 

We  have  a  fair  example  of  what  an  addition  to  the  civil  service  list  means  in  the  compact, 
unionized  body  of  rural  free  delivery  carriers.  When  the  rural  free  delivery  was  first  proposed  in 
Congress  by  Tom  Watson,  he  made  the  point  that  such  mails  would  be  delivered,  in  the  main,  by 

87 


farmer  boys  who  would  be  willing  to  earn  a  little  extra  money,  say,  $20.00  to  $25.00  a  month,  be- 
tween spells  at  the  plow. 

There  is  not  to-day,  possibly,  a  rural  free  delivery  carrier  in  the  United  States  who  would  lower 
his  dignity  by  standing  for  half  an  hour  between  the  plow  handles.  He  is  a  political  leader  in  his  com- 
munity— a  man  of  substance;  and  it  may  be  remarked  in  passing  that,  almost  to  a  man,  the  carriers 
opposed  the  institution  of  a  parcel  post,  and,  on  the  ground  that  it  increases  their  work,  they  are  now 
demanding  more  pay. 

Telegraph  operators  and  telephone  operators  are  not  structurally  different  from  other  folk. 
They  would  soon  be  demanding  not  what  their  services  were  worth,  but  what  the  dominant  political 
party  was  willing  to  award  in  anticipation  of  political  favors  to  come. 

Chillicothe,  Ohio,  Gazette,  December  12,  1913 : 

Chicago  has  had  an  alleged  civil  service  system  for  years.  Here  is  how  the  "Public  Service"  tells 
us  it  works : 

Forty  thousand  persons  are  on  the  public  payroll  in  Cook  County,  in  Chicago.  It  is  estimated 
that  one  out  of  every  20  male  adults  is  a  city  or  county  employee.  Many  are  not  under  civil  service 
regulation.  The  Cook  County  Civil  Service  Commission  in  September  made  a  report  declaring  that  the 
total  amount  of  salaries  paid  county  employees  not  under  civil  service  could  be  reduced  50  per  cent., 
or  $1,072,000,  provided  ordinary  efficiency  supervision  was  used.  The  report  described  many  instances 
of  misfit  political  appointees. 

From  the  address  of  Seth  Low,  President  of  the  National  Civic  Federation,  delivered  at  its 
Fourteenth  Annual  Meeting  in  New  York  City,  on  December  11,  1913: 

*  *  *  try  to  imagine,  if  you  can,  how  the  conflicting  interests  of  different  parts  of  the 
United  States  could  be  harmonized  when  the  same  government  is  responsible  for  railroad  operation 
everywhere.  The  annual  bill  for  the  construction  of  public  buildings  for  the  Federal  government  has 
acquired  the  popular  name  of  "pork-barrel" ;  because  it  is  so  universally  recognized  that  appropria- 
tions for  this  purpose  are  made  to  gratify  local  sentiment  and  to  promote  the  interests  of  individual 
Congressmen  more  than  upon  the  merits  of  the  matter,  as  determined  by  careful  inquiry.  What  pos- 
sibility is  there  that  the  administration  of  a  system  of  National  railroads  would  be,  or  could 
be,  carried  on  under  our  democratic  government  in  any  other  spirit  ?  And  in  what  possible  way  could 
the  general  interests  of  the  people  of  the  United  States,  in  the  matter  of  transportation,  be  less  well 
served  ?  Furthermore,  the  political  consequences  of  centering  such  power  in  Washington  are  beyond 
calculation. 

Scranton,  Pa.,  Scrantonian,  November  9,  1913 : 

In  spite  of  civil  service  rules  and  other  supposed  safeguards,  it  is  a  fact  that  nearly  every  place 
holder  is  with  the  governing  powers  that  be  and  the  acquirement  of  public  utilities  on  a  National  scale 
would  prove  a  tremendous  lever  for  political  control  by  the  party  in  power,  if  it  cared  to  use  it. 

Saturday  Evening  Post,  November  9,  1912 : 

In  spite  of  civil  service  reform,  the  spoils  system  is  pretty  largely  in  control  of  the  Federal 
Government,  and  virtually  in  complete  control  of  many  state  governments.  Naturally,  heads  of  depart- 
ments, who  are  the  president's  political  advisers,  change  with  a  new  administration ;  but  many  subordi- 
nates in  the  most  responsible  positions,  who  ought  to  stand  or  fall  solely  by  the  value  of  their  work, 
are  turned  out  for  political  reasons.  Civil  service  rules  protect  the  clerk  in  his  humble  job,  but  not  in 
his  ambition  to  reach  the  more  responsible  position,  that  is  still  the  spoil  of  politics.  Marshals,  revenue 
officers  and  postmasters  by  the  thousand  are  appointed  because  of  their  politics,  or  fail  of  reappointment 
on  the  same  ground.  The  public  is  taught  to  regard  Government  office  as  a  "plum,"  to  be  won  by 
political  service.  The  same  rule  obtains  in  state  and  city.  Deputy  treasurers,  assistant  auditors,  game- 
wardens  and  oil  inspectors  get  and  hold  their  jobs  through  politics.  Citizen  Jones,  of  Oskamoosa,  is 
congratulated  and  envied  by  his  fellow  townsmen  upon  having  landed  the  fish  inspectorship — because  it 
pays  more  than  he  could  earn  in  any  other  way  by  the  same  effort. 


Saturday  Evening  Post,  November  1,  1913: 

The  Government  can  operate  telephones  and  telegraphs — and  railroads,  for  that  matter — on 
business  principles.  It  cannot  operate  them  on  spoils  principles,  except  at  a  cost  that  would  make  the 
experiment  a  National  calamity.  The  busy  little  grafters  in  both  Houses  of  Congress,  who  distribute 
public  offices  as  rewards  for  political  service,  fairly  foreclose  the  Federal  Government  from  some 
fields  that  it  might  enter  successfully  but  for  them.  So  long  as  the  public  service  is  burdened  with  this 
patronage  graft,  an  extension  of  that  service  to  new  fields  may  well  be  viewed  with  alarm. 

Fall  River,  Mass.,  Herald,  February  12,  1913 : 

"I  hope  to  receive  by  return  mail  your  remittance  of  $39.  Please  do  not  compel  me  to  make 
another  call."  These  words  did  not  appear  in  a  little  note  attached  to  an  overdue  tailor's  bill  nor  are 
they  in  any  way  connected  with  a  coal  man's  account ;  they  are  contained  in  a  letter  written  to  the 
postmaster  at  Beebe,  Ark.,  by  Gordon  H.  Campbell,  treasurer  of  the  Republican  State  committee  dur- 
ing the  presidential  campaign  of  1912,  according  to  testimony  brought  out  at  the  hearing  in  Washing- 
ton. Mr.  Camp  did  not  accept  the  letter  seriously.  As  a  result  he  is  no  longer  postmaster.  He  was 
compelled  to  resign  under  protest  a  few  weeks  ago  because  of  suddenly  discovered  inefficiency,  dere- 
liction of  duty  and  divers  and  sundry  other  things  of  which  he  has  no  knowledge.  But  if  the  plain 
truth  were  known  it  is  more  than  probable  that  Mr.  Camp  was  kicked  out  of  office  because  he  refused 
to  contribute  three  per  cent,  of  his  annual  salary  to  the  political  machine  in  his  State. 

Utica,  N.  Y.,  Press.  July  25,  1912: 

One  of  the  most  fruitful  causes  and  occasions  for  complaint  in  political  campaigns  is  that  the 
politicians  control  all  the  office  holders,  their  clerks  and  subordinates  with  great  effort  at  caucuses 
and  election  time.  The  postmasters,  for  example,  are  selected  by  their  prospective  Congressman  with 
a  view  to  their  political  activity  and  ability,  and  they  are  expected  to  be  exceedingly  useful  every  two 
years  when  the  member  seeks  renomination  and  re-election.  That  is  true  of  every  person  on  the  public 
payroll,  state,  county  and  city.  They  make  an  organized  army  which  is  frequently  very  efficient. 
Suppose  that  all  the  employees  of  the  express,  telephone,  telegraph  and  railroad  companies  were  also 
on  the  public  payroll,  owing  their  positions  in  greater  or  less  degree  to  the  political  favoritism  of  those 
in  control  of  the  government?  ITiat  would  multiply  the  army  very  materially,  and  the  bread  and 
butter  question  is  an  extremely  strong  argument.  It  would  be  practically  impossible  to  oust  from 
power  the  party  which  had  this  multitude  of  workers  at  its  command.  Whoever  happened  to  be  Presi- 
dent of  the  United  States  under  such  a  system  coukl  hold  office  indefinitely  if  he  wished  to,  and  per- 
haps somebody  would. 

Washington,  D.  C,  Post,  June  17.  1912: 

Even  drastic  civil  service  rules  cannot  nullify  the  unwritten  law  that  "to  the  victor  belongs  the 
spoils."  So  long  as  there  are  politicians,  politics  will  play  its  part  in  the  government  service,  and  if 
that  service  is  extended  to  public  utilities,  the  administrations  of  the  latter  will  be  marred  by  political 
influence  and  favoritism. 

Saturday  Evening  Post,  May  18,  1912: 

Somewhere  round  the  post  office  you  will  find  a  formidable  placard  headed  in  blood-red  type — 
Warning  Against  Activity  in  Politics  by  Federal  Officers  and  Employees.  The  postmaster  who  hung 
it  up  was  appointed  on  the  recommendation  of  a  senator  or  representative  exactly  because  he  had  been 
active  in  politics.  He  knows  very  well  that  if  his  party,  or  his  faction  of  his  party,  is  defeated  he  will 
be  turned  out  when  his  term  expires,  or  before.  He  knows  the  post  office  offers  him  no  permanent 
employment  and  that,  whatever  his  record  may  be,  he  has  not  the  slightest  chance  of  advancement. 
The  better  positions  and  larger  salaries  will  not  go  to  those  who  have  performed  valuable  service  in  the 
department,  but  to  those  who  have  performed  valuable  service  in  politics.  So  it  is  in  other  depart- 
ments. 

89 


Extract  from  an  article  entitled  "The  Government  and  the  Railroads,"  by  Arthur  T.  Hadley, 
LL.D.,  President  of  Yale  University,  published  in  Youth's  Companion,  April  18,  1912 : 

Congress  at  each  session  invests  a  large  amount  of  public  money  for  the  improvement  of  trans- 
portation facilities  through  the  agency  of  a  river  and  harbor  bill.  Is  this  money  wisely  invested,  with  a 
far-sighted  view  toward  the  public  interest?  No.  Each  member  of  Congress  is  more  concerned  with 
the  immediate  demands  of  his  district  than  with  th  general  needs  of  the  country.  Thousands  of  dol- 
lars are  wasted  in  dredging  streams  that  cannot  ever  be  of  any  considerable  use,  while  large  and  much- 
needed  improvements  are  either  postponed  or  carried  on  in  a  half-hearted  and  inefficient  manner. 

Editorial  by  Theodore  Roosevelt,  in  The  Outlook,  April  6,  1912 : 

I  have  before  me  as  I  write  the  original  of  a  letter  sent  to  Mr.  Figley,  the  postmaster  at  Hast- 
ings, Oklahoma,  by  Mr.  James  Harris,  the  Chairma     of  the  Republican   State  Committee.     The  en- 
velope is  marked  "personal,"  together  with  a  memorandum  to  return  it  after  five  days  to  the  Harris 
Brothers.    The  letter  itself  runs  as  follows : 
Dear  Sir : 

I  am  in  receipt  of  the  following  letter  from  the  Department : 

"The  commission  of  Newton  S.  Figley,  Postmaster  at  Hastings,  Oklahoma,  will  expire  Feb- 
ruary 28,  1912.  When  last  inspected,  this  office  did  not  appear  to  be  in  a  satisfactory  condition,  and 
unless  the  postmaster  can  be  relied  upon  to  raise  the  service  to  a  higher  standard  of  efficiency  it  is  be- 
lieved that  he  should  not  be  reappointed.  The  department  will  be  pleased  to  receive  as  promptly  as 
possible  an  expression  of  your  views  as  to  what  action  in  this  case  will  be  for  the  best  interests  of  the 
service. 

"I  hope  you  have  your  office  in  first-class  condition  and  will  continue  to  have  it  so. 

"H  you  will  bring  in  a  delegation  to  the  State  and  District  Conventions  instructed  for  Taft  and 
Jim  Harris,  I  will  see  that  you  are  reappointed. 

"With  best  wishes,  I  am, 

Very  truly, 
(Signed)    J.  A.  Harris,  Chairman." 

Mr.  J.  E.  Dyche,  of  Oklahoma  City,  Oklahoma,  who  forwarded  the  letter  to  me,  writes  in  an 
entirely  friendly  spirit  about  Mr.  Harris,  and  say  that  Mr.  Harris  has  admitted  to  him  that  the  letter 
is  genuine,  and  that,  moreover,  he  knows  Mr.  Harris's  signature. 

Statement  by  James  Dalrymple,  Manager  of  the  Glasgow  Municipal  Tramways,  as  published 
in  the  Boston,  Mass.,  Transcript,  January  31,  1906: 

To  put  street  railroads,  gas  works,  telephone  companies,  etc.,  under  municipal  ownership  would 
be  to  create  a  political  machine  in  every  large  city  that  would  be  simply  impregnable.  The  political 
machines  are  already  strong  enough  with  their  control  of  policemen,  firemen  and  other  office  holders. 

If,  in  addition  to  this,  they  could  control  th  thousands  of  men  employed  in  the  great  public 
utility  corporations,  the  political  machines  would  have  a  power  that  could  not  be  overthrown. 

I  came  to  this  country  a  believer  in  public  ownership.  What  I  have  seen  here,  and  I  have 
studied  the  situation  carefully,  makes  me  realize  that  private  ownership  under  proper  conditions  is  far 
best  for  the  citizen  of  American  cities. 

New  York  World,  December  26,  1913 : 

National  ownership  of  telegraph  and  telephones  would  mean  a  governmental  monopoly  of  com- 
munication. It  is  not  enough  to  assume  that  in  most  cases  and  under  most  administrations  the  privacy 
of  this  business  would  be  respected.  We  must  take  into  account  conditions  that  all  experience  shows 
may  easily  arise  under  exceptional  men  and  extraordinary  temptation. 

Less  than  six  years  ago  it  was  found  that  Roosevelt  was  spending  more  than  $7,000,000  a  year 
on  three  thousand  secret  service  agents,  the  whole  s  'stem  being  in  violation  of  the  spirit  of  the  law,  and 
part  of  it  in  violation  of  the  letter  of  the  law.  When  Congress  undertook  to  assert  its  constitutional 
powers  over  government  expenditures,  Mr.  Roosevelt  had  the  effrontery  to  declare  in  a  message  that 

90 


this  action  was  taken  because  Congressmen  themselves  were  afraid  of  being  investigated  by  its  spies. 
We  have  had  in  this  countrj'  a  benevolent  McKinley  with  Mark  Hanna  behind  him.  We  have  had  an 
easy-going  Grant  with  Zach  Chandler  at  his  elbow.  Who  will  say  such  characters  and  combinations 
will  not  appear  again? 

National  monopoly  of  communication  would  be  more  than  an  instrument  of  oppression,  it  would 
be  a  mighty  promoter  of  oppression.  There  would  be  an  espionage  in  every  suspected  post  office, 
spies  at  every  suspected  telegraph  station  and  eaves-droppers  at  every  suspected  telephone  booth.  All 
these  instruments  of  communication  would  be  in  the  power  of  politicians  and  political  organizations. 

Baltimore,  Md.,  Star,  December  18,  1913 : 

"Control  over  all  means  of  communication  of  intelligence"  would  mean  that  every  telephone 
and  telegraph  operator  would  be  a  Government  employee  and  a  potential  Government  spy.  That  ad- 
ministration which  desired  to  muzzle  the  press  might,  under  cover  of  a  carefully  prepared  set  of  rules, 
beyond  the  immediate  reach  even  of  Congress,  debar  from  the  telegraph  system  press  messages  which 
proved  displeasing  to  the  powers  that  were  on  the  simple  plea  that  it  was  thus  preventing  the  dissemina- 
tion of  "false"  information. 

Baltimore,  Md.,  American,  December  16,  1913: 

It  is  seen  at  a  glance  that  with  the  government  m  control  of  the  telegraph,  with  the  system  of 
party  government  in  force,  the  situation  would  be  that  of  the  telegraph  lines  under  control  of  a  party. 
In  his  speech  to  the  suffragists  Mr.  Wilson  laid  down  the  principle  that  he  as  head  of  the  nation  is 
also  the  head  of  his  party  and  governed  by  it.  So  that  the  President  of  the  United  States  and  his 
fellows  of  the  administration,  as  good  partisans,  would  be  called  upon  to  use  or  pervert  the  power  of 
the  telegraph  for  their  own  purposes.  Hence  they  would  suppress  classes  of  newspaper  dispatches 
upon  the  ground  that  they  werejlibelous  or  otherwise  subject  to  suppression.  With  a  compliant  attor- 
ney-general to  refer  the  matter  to,  the  way  would  be  open  for  legal  sanction.  Thus  there  might  be 
established  the  worst  form  of  indirect  censorship  of  the  press  through  partisan  control  of  the  telegraph 
— not  only  might  be,  but  would  be.  There  are  too  many  politicians  as  it  is  who  fume  and  fret  under 
the  lash  of  publicity,  and  control  of  the  chief  medium  of  publicity  would  enable  them  to  reduce  the 
United  States  under  forms  of  law,  not  ostensibly  violating  liberty,  to  a  condition  little  better  than  that 
of  Russia. 

Washington,  D.  C,  Post,  February  14,  1913: 

Another  strong  objection  to  government  monopoly  is  that  it  breeds  bureaucracy,  the  worst  of 
paternalism's  sins.  The  old  world  governmentally  is  in  the  clutch  of  that  off-shoot  of  monarchism, 
and  evidences  are  not  lacking  that  democracy  as  practiced  in  America  to-day  is  taking  a  strong  slant  in 
the  same  direction.  Bureaucracy  as  we  see  it  at  work  brushes  Federal  and  State  laws  aside,  sets  up  its 
own  standards  of  administration,  and  tramples  private  rights  ruthlessly.  "Anything  that  is  right  is 
l^al"  is  bureaucracy's  motto,  and  its  bill  of  rights  is  something  to  behold. 

World's  Work,  December,  1906— article  by  T.  B.  Womacle,  formerly  Judge  of  the  Supreme 
Court  of  North  Carolina : 

It  was  a  part  of  Governor  Morehead's  dream  that  North  Carolina  should  have  a  great  through 
system  of  railroads  from  mountains  to  seashore.  To  carry  out  this  idea,  a  charter  was  obtained  for 
a  road  from  Goldsboro,  the  eastern  terminus  of  the  North  Carolina  Railroad,  to  the  coast  at  More- 
head  City,  a  place  named  in  honor  of  the  Governor  and  then  considered  a  great  city  of  the  future. 
The  state  took  12,000  of  the  18,000  shares  of  stock,  appointed  a  majority  of  the  directors,  and  has 
had  absolute  control. 

This  road  has  now  been  operated  by  the  state  of  North  Carolina  for  nearly  half  a  century,  in 
war  and  peace,  by  Democrats,  by  Republicans,  and  by  Fusionists — each  with  varying  degrees  of  fail- 
ure. The  private  stockholders  for  years  have  pleaded  for  a  lease,  or  for  anything  to  avoid  a  con- 
tinuance of  political  mismanagement.    During  these  many  years  no  dividend  has  been  earned,  though 

91 


one  or  two  presidents  declared  dividends  of  one  or  two  per  cent,  per  annum  for  political  effect,  when 
every  cent  should  have  been  used  in  betterments.  The  stock  value  ranged  from  ten  to  twenty-five 
cents. 

Finally,  under  the  administration  of  Governor  Aycock,  it  became  known  that  the  administra- 
tion had  determined  to  heed  the  cries  of  the  private  stockholders  and  the  sound  business  judgment  of 
the  people  of  the  state,  and  lease  this  last  of  the  State's  railroads.  A  great  sigh  of  relief  went  up  from 
mountains  to  sea.    *    *    * 

The  effects  of  the  lease  were  immediate.  The  first  year  of  private  management  improved  the 
road-bed  and  equipment  to  a  point  never  before  approached.  The  road  is  being  extended  and  new 
connections  made,  and  is  run  upon  business,  as  opposed  to  political,  methods. 

From  "Philosophy  and  Political  Economy"  (1893,  Book  5,  Chapter  2,  page  372),  by  James 
Bonar : 

There  seems  to  be  nothing  in  the  theory  of  development  to  point  us  clearly  to  any  centraliza- 
tion of  all  industrial  organization  in  the  State.  It  has  yet  to  be  shown  in  practice  that  beyond  a  cer- 
tain limit,  centralization  would  not  be  fatal  to  the  spontaneous  organization  which  has  as  yet  been  the 
main  source  of  all  industrial  progress. 

From  "Railroad  Transportation"  (1885,  page  49),  by  Arthur  T.  Hadley,  LL.D.,  President  of 
Yale  University : 

Once  let  the  idea  go  forth  that  it  is  the  duty  of  the  state  to  take  care  of  everybody,  and  every- 
body will  cease  to  take  care  of  himself. 


REGULATION  VS.  OWNERSHIP 

(Official) 

From  decision  of  the  Supreme  Court  of  the  State  of  Washington  (120  Pac.  Rep.  861,  at  869)  : 
In  its  search  for  remedies  and  while  seriously  considering  municipal,  state,  or  government 
ownership,  the  public,  by  reference  to  the  police  power  of  the  state,  has  almost  unwittingly  *  *  * 
solved  the  problem,  and  has  by  the  application  of  fundamental  as  well  as  established  relative  proposi- 
tions of  law  gained  every  advantage  of  ownership  without  assuming  its  burdens.  *  *  *  With 
the  power  to  fix  rates  established,  the  process  of  elimination  of  unjust  rates  became  a  mere  matter  of 
detail  based  upon  mathematical  calculation ;  the  only  question  giving  any  ground  for  debate  being  the 
basis  of  calculation. 

*  *  *  While  rivalry  may  be  promoted,  monopoly  in  the  sense  of  oppression  is  made  impossible. 
The  benefit  of  ownership  is  enjoyed,  while  its  dangers — not  the  least  of  which  is  the  political  activ- 
ities of  great  armies  of  public  employees — are  no  longer  a  menace  to  those  who,  to  avoid  the  hazards 
of  public  ownership,  have  unwittingly  subscribed  to  the  conditions  prevailing  before  this  and  other 
states  entered  upon  the  policy  of  public  control. 

Extract  from  the  Second  Inaugural  Message  of  Governor  Adolph  O.  Eberhart  to  the  Legis- 
lature of  Minnesota,  1913 : 

In  my  opinion,  public  utilities  must  be  either  owned  or  controlled  by  the  people.  Where  the 
control  can  be  vested  in  a  fair,  impartial  and  competent  authority,  removed  as  far  as  possible  from 
political  influence,  it  is  far  superior  to  ownership.  It  has  been  found  by  experience  that  it  is  very 
difficult  to  keep  municipally  owned  plants  out  of  politics.  As  a  general  principle  it  is  true  that  the 
state  or  the  city  should  not  go  into  any  business  which  can  be  transacted  as  well  by  individuals. 

From  speech  by  Judge  Lorin  Cray,  of  Mankato,  Minn.,  published  in  Public  Service,  Chicago, 
111.,  November,  1913,  page  176: 

After  all,  it  occurs  to  the  writer  that  while  we  yet  remain  ordinary  human  beings,  uncontrolled 
by  divine  impulses,  that  the  safest  way  to  deal  with  public  utilities  is  to  foster  private  ownership  and 

92 


adopt  a  system  of  careful  regulation,  as  distinguished  from  actual  control.     The  power  exists,  and 
the  means  are  at  hand,  but  we  should  be  just. 

Extract  from  a  speech  by  George  A.  Lee,  Chairman  of  the  Public  Service  Commission  of 
W^ashington,  before  the  Educational  club  of  the  Tacoma  Gas  Company,  Tacoma,  Washington  (Pub- 
lic Service,  May,  1913,  page  167) : 

Public  service  regulation  as  evidenced  by  the  public  service  commission  law  of  Washington, 
is  the  alternative  of  municipal  control  and  ownership.  Such  regulation  affords  and  secures  all  the 
alleged  benefits  and  advantages  of  municipal  ownership  without  the  evils  and  disadvantages  incident 
thereto.  If  such  regulatory  laws  secure  good  service  and  reasonable  rates  and  safe  and  efficient  in- 
strumentalities and  facilities  then,  certainly,  there  can  be  no  logical  or  conclusive  argument  in  behalf 
of  the  surrender  of  such  r^;ulation  for  the  experimental  and  dangerous  plan  of  municipal  ownership. 
In  my  judgment  the  passage  of  public  service  laws  in  many  states  within  the  last  few  years  marks  a 
new  regime  and  gives  the  public  that  service  and  those  rates  to  which  they  are  entitled  and  gives  the 
companies  that  rate  of  return  which  the  constitution  permits  them  and  at  the  same  time  avoids  the 
dangers  and  pitfalls  of  municipal  regulation  and  municipal  ownership. 

Extract  from  speech  of  President  Woodrow  Wilson,  at  a  meeting  of  the  Federation  of  Demo- 
cratic Qubs  in  Pennsylvania,  held  at  Harrisburg,  June  15,  1911.  (Reprinted  in  the  Congressional 
Record,  August  14,  1912,  page  11824): 

The  regulation  of  corporations  is  hardly  less  significant  and  central.  We  have  made  many 
experiments  in  this  difficult  matter,  and  some  of  them  have  been  crude,  and  hurtful,  but  our  thought 
is  slowly  clearing.  We  are  beginning  to  see,  for  one  thing,  how  public  service  corporations,  at  any 
rate,  can  be  governed  with  great  advantage  to  the  public  and  without  serious  detriment  to  themselves, 
as  undertakings  of  private  capital.  Experience  is  removing  both  prejudice  and  fear  in  this  field,  and 
it  is  likely  that  within  the  very  near  future  we  shall  have  settled  down  to  some  common,  rational,  and 
effective  policy.  The  regulation  of  corporations  of  other  sorts  lies  intimately  connected  with  the  gen- 
eral question  which  ramifies  in  a  thousand  directions,  but  the  intricate  threads  of  which  we  are  slowly 
beginning  to  perceive  constitute  a  decipherable  pattern.  Measures  will  here  also  frame  themselves 
soberly  enough  as  we  think  our  way  forward. 

From  President  Taft's  Special  Message  to  Congress,  February  22,  1912.  (Reprinted  in  the 
New  York  Times,  February  23,  1912) : 

This  presents  the  question  of  government  ownership  of  public  utilities,  which  are  now  being  con- 
ducted by  private  enterprise  under  franchises  from  the  government.  I  believe  that  the  true  principle 
is  that  private  enterprises  should  be  permitted  to  carry  on  such  public  utilities  under  due  regulation  as 
to  rates  by  proper  authority,  rather  than  that  the  government  should  itself  conduct  them.  This  pin- 
ciple,  I  favor,  because  I  do  not  think  it  in  accordance  with  the  best  public  policy  thus  greatly  to  increase 
the  body  of  public  servants. 

Extract  from  a  speech  delivered  by  ex-President  Roosevelt  on  October  19,  1905,  at  Raleigh, 
N.  C.  (Mitchell,  S.  D.,  Republican,  December  4,  1913): 

I  do  not  believe  in  government  ownership  of  anything  which  can  with  propriety  be  left  in  pri- 
vate hands,  and  in  particular  I  should  most  strenuously  object  to  government  ownership  of  railroads. 
But  I  believe  with  equal  firmness  that  it  is  out  of  the  question  for  the  government  not  to  exercise  a 
supervisory  and  regulatory  right  over  the  railroads ;  for  it  is  vital  to  the  well  being  of  the  public  that 
they  should  be  managed  in  a  spirit  of  fairness  and  justice  toward  all  the  public.  Actual  experience 
has  shown  that  is  it  not  possible  to  leave  the  railroads  uncontrolled. 

(Editorial) 

Atlanta,  Ga.,  Constitution,  December  19,  1913: 

It  must  be  remembered  that  in  this  country  we  have  now  all  the  advantages  and  none  of  the 
disadvantages  of  government  ownership.    We  have  strict  government  r^;ulation  of  prices  and  prac- 

93 


tices.  We  can  enforce  reasonable  rates.  And  the  Government  has  nothing  whatever  of  the  respons- 
ibility. This  is  not  to  reckon  with  the  enormous  sum  in  taxes  paid  to  the  states  and  nations.  This 
would  be  lost  under  government  ownership. 

Springfield,  Mass.,  Republican,  December  18,  1913 : 

President  Taft's  Postmaster,  Mr.  Hitchcock,  recommended  government  ownership  of  telegraph 

lines  without  including  telephone  Hnes.     President  Taft  did  not,  however,  endorse  the  idea — Mr.  Wick- 

ersham,  his  attorney-general,  no  doubt  voiced  Mr.  Taft's  view  in  a  letter  to  the  Interstate  Commerce 

Commission  about  a  year  ago,  in  which  telegraph  and  telephone  business  was  declared  to  be  a  natural 

monopoly,  impossible  to  run  on  competitive  lines,  yet  best  run  to  "the  reasonable  satisfaction  of  the 

public  under  Government  control  and  regulations  with  private  ownership  retained."  * 

********  *  *  * 

Government  regulation  of  the  telegraph  and  telephone  companies  has  not  been  tried  out;  the 
Interstate  Commerce  Commission  has  had  jurisdiction  over  them  but  for  a  very  short  time.  Give  this 
policy  a  trial  first  of  all. 

Philadelphia,  Pa.,  Public  Ledger,  October  26,  1913 : 

President  Wilson  carefully  weighed  the  matter  of  the  two  alternatives  of  private  and  Govern- 
ment regulation  and  of  Government  ownership  and  management,  and  he  said:  "Government  regu- 
lation may  in  most  cases  suffice.  Indeed,  such  are  the  difficulties  in  the  way  of  establishing  and  main- 
taining careful  business  management  on  the  part  of  the  Government,  that  control  ought  to  be  preferred 
to  direct  administration  in  as  many  cases  as  possible — in  every  case  in  which  control  without  adminis- 
tration can  be  made  effectual." 

Joliet,  111.,  Herald,  October  24,  1913: 

Mere  cheapness  is  a  secondary  consideration  with  the  American  people.  We  must  have  ser- 
vice even  if  we  have  to  pay  for  it.  We  cannot  expect  Pullman  seats  at  immigrant  rates,  but  we  are 
not  going  to  drive  a  public  ownership  policy  to  the  point  where  we  shall  have  emigrant  seats  at  Pull- 
man prices. 

Regulation,  not  confiscation,  is  the  solution  of  the  telegraph  and  telephone  problem. 

Brooklyn,  N.  Y.,  Daily  Eagle,  October  2,  1913 : 

Government  ownership  and  operation  of  telegraph  and  telephone  lines  would  be  a  venture  for 
which  no  substantial  justification  could  anywhere  be  found.  Government  control  of  these  utilities  in 
foreign  countries,  particularly  in  France,  has  not  been  a  success.  We  do  not  need  to  repeat  foreign 
experiments  and  foreign  failures  here.  No  substantial  interest  is  asking  for  the  change.  Government, 
Federal  and  State,  either  now  has  or  can  obtain  sufficient  power  of  regulation  over  telegraph  and  tele- 
phone companies  to  protect  the  public  against  extortionate  rates  and  inefficient  service.  That  power 
already  resides  in  the  State  of  New  York,  and  such  protection  is  all  the  public  requires.  Power  to 
regulate  is  all  that  Government  should  seek  or  expect  in  relation  to  these  public  utilities  which  are 
essentially  enterprises  for  private  operation  not  fields  for  wild  experiments  in  State  Socialism. 

Extract  from  the  Report  to  the  Board  of  Trustees,  New  Seattle  Chamber  of  Commerce,  Seattle, 
Washington,  submitted  January  17,  1913,  by  the  Executive  Committee  Bureau  of  Taxation : 

The  establishment  of  a  municipal  telephone  system  can  be  justified  only  upon  the  ground  that 
it  is  necessary  to  insure  good  service  and  reasonable  rates  from  the  present  system ;  a  need  which  is  at 
present  filled  by  the  Public  Service  Commission  with  which  any  citizen  may  lodge  complaint. 

Extract  from  the  report  of  the  Department  on  Regulation  of  Interstate  and  Municipal  Utilities 
to  the  National  Civic  Federation,  January,  1913: 

Whatever  may  be  the  views  of  any  individual  regarding  the  desirability  of  having  the  State  reg- 
ulate the  conduct  of  public  utility  enterprises,  all  must  agree  that  the  signs  of  the  times  point  clearly 
in  one  of  two  directions — either  to  public  ownership  and  operation,  or  to  public  regulation  of  private 

94 


ownership  and  operation.  Competition,  relied  upon  in  the  earlier  days  to  protect  supposed  public  in- 
terests, has  failed  completely.  Competition  in  a  public  service  business  is  war,  and  General  Sherman's 
description  of  war  applies  as  well  to  the  public  service  industry  as  to  the  battlefield.  The  furnishing  of 
a  transportation,  gas,  water,  electric,  telephone  or  other  public  service  is,  and  should  be,  naturally  a 
monopoly.  Unregulated  monopoly  in  any  field  of  endeavor  is  abhorrent  to  Anglo-Saxon  people. 
While  regulation  of  pubHc  utilities  must  be  based  on  full  recognition  of  the  monopolistic  character  of 
the  business,  it  is  also  true  that  recognition  of  monopoly  invites  public  regulation  or  public  ownership 
and  operation.  The  Department  believes  not  only  that  public  regulation  is  preferable  to  public  owner- 
ship and  operation,  but  that  public  ownership  and  operation  may  be  deferred  only  by  reasonable  public 
regulation. 

From  statement  by  Cardinal  Gibbons,  published  in  the  New  York  Evening  Sun,  September  4, 
1912: 

I  believe  in  the  proper  regulation  of  big  business  combinations  and  the  broadminded  at  the  head 
of  these  vast  business  enterprises  would,  I  am  sure,  welcome  fair  and  intelligent  Government  control. 
Such  control  should  be  of  a  nature  to  assure  the  people  good  service  at  prices  which  would  protect 
the  honest  investor,  it  should  prevent  industrial  warfare,  should  end  political  interference  and  should 
encourage  honest  effort  to  serve  the  people  with  the  utilities  which  they  require. 

It  must  be  remembered  by  those  who  so  foolishly  demand  public  and  Government  ownership 
that  year  by  year  the  great  public  utility  corporations  are  becoming  more  and  more  the  property  of  the 
public. 

For  instance,  five  years  ago,  when  Theodore  N.  Vail  became  President  of  the  American  Tele- 
phone Company,  there  were  18,000  stockholders ;  now  there  are  over  50,000.  This  corporation  serves 
25,000,000  people  daily.  In  1901  the  Baltimore  &  Ohio  Railroad  had  3,256  stockholders ;  now  it  has 
over  11,000.  Ten  years  ago  the  Pennsylvania  Railroad  had  27,870  stockholders;  now  it  has  over  72,- 
000.  In  the  same  period  the  Great  Northern  Railroad  has  increased  its  stockholders  from  700  to  18,- 
000 ;  the  New  York  Central  from  9,872  to  over  22,000.  At  the  present  time,  it  is  stated  by  authorities, 
the  owners  of  the  railroads  in  the  United  States  number  not  less  than  2,000,000  people. 

When  there  are  added  to  these  the  owners  of  stocks  and  bonds  in  other  public  service  corpora- 
tions, it  will  be  apparent  to  all  fair  men  that  public  ownership  of  the  proper  kind  is  already  here.  Mil- 
lions of  our  people  have  a  direct  and  personal  interest  in  the  public  serving  business,  and  they  are  not 
going  to  be  misled  by  any  of  the  unfounded  and  theoretical  beliefs  of  the  Socialists  of  Government 
ownership. 

From  the  "Principles  of  Economics,"  Vol.  II,  Book  VII,  Chapter  62,  pp.  417-418,  by  F.  W. 
Taussig,  Professor  of  Political  Economy  at  Harvard  University,  191 1 : 

For  the  present,  however,  and  as  far  in  the  future  as  we  can  see,  the  main  task  before  demo- 
cracy in  America  is  that  of  making  more  simple  and  smooth-working  its  political  machinery ;  of  secur- 
ing plain  honesty  and  routine  efficiency  in  the  accepted  functions  of  government ;  and  of  regulating 
with  some  tolerable  success  the  industries  of  the  monopoly  type.  When  good  results  in  these  compara- 
tively simple  problems  have  been  achieved,  it  will  be  time  to  turn  to  the  larger  and  more  complex 
problem  of  public  industry  on  a  greatly  extended  scale. 

From  the  "Principles  of  Economics,"  Vol.  II,  Book  VII,  Chapter  62,  p.  413,  by  F.  W.  Taus- 
sig, Professor  of  Political  Economy  at  Harvard  University,  1911: 

The  clear  alternative,  then,  and  only  alternative,  to  public  management  is  public  regulation. 
Ideally,  regulation  is  less  good,  but  practically  it  may  be  much  better.  Reasonably  successful  regulation 
is  more  easy  to  attain  than  reasonably  successful  public  management. 

Statement  made  by  Charles  E.  Hughes,  Justice  of  United  States  Supreme  Court  and  ex-Gov- 
cmor  of  New  York,  in  an  address  on  January  31,  1908,  in  New  York  City: 

I  do  not  believe  in  governmental  ownership  of  railroads.    But  regulation  of  interstate  transpor- 

95 


\ 


tation  is  essential  to  protect  the  people  from  unjust  discriminations  and  to  secure  safe,  advantageous 
and  impartial  service,  upon  reasonable  terms  in  accordance  with  the  obligations  of  common  carriers. 

Extract  from  "The  Problem  of  Monopoly,"  (1904,  Chapter  6,  Pages  115  and  120),  by  J.  B. 
Clark,  Professor  of  Political  Economy  at  Columbia  University: 

The  difference  (t.  e.  in  public  benefits)  between  a  thorough  system  of  governmental  regulation 
and  a  system  of  governmental  ownership  is  by  no  means  as  wide  as  it  appears;  and  what  difference 
there  is,  is  in  favor  of  the  regulated  private  ownership.  Such  ownership,  if  unregulated,  has  little  to 
commend  it.  *  *  *  We  would  better  make  a  thorough  test  of  the  alternative  plan  and  adjourn  the 
question  of  public  ownership  till  the  plan  of  public  control  shall  have  been  proved  a  failure. 

That  it  is  wise,  before  resorting  to  government  ownership,  to  experiment  with  regulation  more 
earnestly  and  judiciously  than  we  have  ever  done,  is  sufficiently  clear. 

Extract  from  "Modern  Industrialism,"  (1904,  Part  III,  Chapter  4,  Pages  271-272),  by  P.  L. 
McVey,  President  of  the  University  of  North  Dakota: 

*  *  *  It  is,  therefore,  impossible  to  say  "a  priori"  that  a  government  shall  own  and  operate 
its  great  industries.  Each  State  must  determine  what  things  it  can  do  best.  The  day  of  laissez  faire 
has  passed  and  regulation  or  ownership  will  be  the  method  of  conducting  industry.  Experience  in 
trusting  elaborate  industrial  functions  to  a  democracy  is  not  large,  and  where  tried,  not  convincing  in 
its  results.  A  nation  must  first  have  the  necessary  civic  capacity  before  it  can  successfully  cope  with 
the  great  industrial  problems  and  even  then  the  union  of  economy  and  enterprise  is  not  assured.  In 
the  control,  even  of  the  ownership  of  monopolies,  the  State  has  a  field  of  action  to  which  it  may  well 
confine  its  efforts. 

Extract  from  "American  Railway  Transportation,"  (1903,  Part  4,  Chapter  29,  Page  427),  by 
E.  R.  Johnson,  Professor  of  Transportation  and  Commerce,  University  of  Pennsylvania: 

The  regulation  of  railroads  in  the  United  States  is  apparently  not  to  be  accomplished  by  means 
of  Government  ownership.  The  commission  system  has  been  on  trial  in  the  States  for  thirty  years  and 
in  the  National  Government  for  sixteen  years,  and  while  the  results  accomplished  are  not  fully  satis- 
factory, the  system  has  not  been  a  failure.  The  success  of  the  Federal  commission  has  been  far  less 
than  it  might  have  been  had  the  demonstrated  defects  in  the  law  of  1887  been  corrected ;  but  the  wis- 
est plan  for  the  United  States  to  follow,  at  least  in  the  immediate  future,  is  to  improve  the  methods 
and  agencies  of  regulation  now  being  employed,  rather  than  to  attempt  the  enormous  task  of  purchas- 
ing and  operating  two-fifths  of  the  railway  mileage  of  the  world. 


POST  OFFICE 

(Official) 

From  "Public  Finance"  (1899,  Part  II,  Chapter  9,  Pages  215-218),  by  W.  M.  Daniels,  for- 
merly of  the  Department  of  Political  Economy,  Princeton  University,  and  recently  appointed  by  Pres- 
ident Wilson  member  of  the  Interstate  Commerce  Commission: 

The  post-office,  upon  investigation,  proves  to  be  unique  in  more  ways  than  one.  The  risks  in- 
volved in  the  ordinary  processes  of  trade  and  manufactures  are  wholly  absent.  The  system  of  trans- 
portation of  which  it  avails  itself  is  ready  to  its  hand.  "It  has  made  use  of  existing  and  well-known 
agencies,  where  the  only  difficulty  was  one  of  organization,"  says  Lord  Farrer,  who  adds :  "It  is  a 
merit  of  the  undertaking,  regarded  as  an  official  institution,  that  there  is  very  little  of  that  speculative 
element  about  it  which  is  the  life-blood  of  commercial  activity."    The  capital  which  the  state  is  required 

96 


^ 


to  furnish  is  comparatively  small  in  amount.  *  *  *  Add,  finally,  to  the  other  peculiar  char- 
acteristics of  the  post-office  this,  that  an  increase  in  its  volume  of  business  does  not  ordinarily  involve 
a  corresponding  increase  in  its  working  expenses,  and  that  the  great  postal  reforms  and  improvements 
have  as  often  been  forced  upon  the  department  from  outside  as  they  have  originated  within  its  own 
official  circle,  and  we  are  in  a  position  to  understand  why,  as  Adam  Smith  says,  it  is  "the  only  mer- 
cantile project  which  has  been  successfully  managed  by  *  *  *  every  sort  of  government."  Where 
other  enterprises  call  for  venturesome  and  speculative  activity,  the  post-office  requires  orderly  routine ; 
where  the  former  demand  much  fixed  capital,  the  post  needs  comparatively  little;  where  in  ordinary 
business  transactions  prices  vary  even  for  the  same  service,  the  post-office  has  always  one  price  for  the 
same  service;  where  other  industrial  enterprises,  if  mismanaged,  long  escape  exposure  and  protest,  the 
Argus-eyed  public  is  daily  inspecting  the  efficiency  of  the  postal  service;  where  the  freight  agent  is 
puzzling  over  a  complicated  railway  tariff,  the  postal  clerk  has  the  same  simple  regulations  to  guide 
him  to-day  and  to-morrow. 

From  Table  No.  4,  "Comparison  of  Postal  Revenues,  Expenditures,  Etc.,  Fiscal  Years  1837  to 
1912,  Inclusive," — Report  of  the  Auditor  for  the  Post  Office  Department,  in  Postmaster  General's  Re- 
port for  Year  Ending  June  30,  1912  (Page  335).  It  should  be  noted,  in  connection  with  the  figures 
given  below,  that  the  accounts  include  only  those  audited  by  the  Auditor  for  the  Post  Office  Depart- 
ment, and  that  the  Auditor  for  the  Treasury  Department  audits  other  expenses  of  the  postal  service, 
not  included  in  the  Postmaster  General's  Report.  The  total  net  deficit  from  the  operation  of  the  Post 
Office  Department,  1837-1912.  according  to  the  figures  shown  below,  is  $330,725,306.29. 


Fiscal  Year. 
1837* 
1838 
1839 
1840 
1841 
1842 
1843 
1844 
1845 
1846 
1847 
1848 
1849 
1850 
1851 
1852 
1853 
1854 
1855 
1856 
1857 
1858 
1859 
1860 
1861 
1862 
1863 
1864 

The  aOcc 


Audited  Postal 
Surf>lus. 
$  813.384.58 


174,751.47 
227,512.56 
286.739.94 
131.894.62 


Audited  Postal 
Deficit. 

$      191,928.75 

151,879.61 

174,713.72 

91,960.46 

1,124.213.30 

78,618.84 

61,340.12 

36,850.13 

633,318.22 

200,819.16 


1,923,022.85 

2,742,364.67 

2,352,699.98 

3,326,856.15 

3,487,046.52 

4,153,718.40 

5,234343.70 

3,489,028.26 

10,652,538.66 

5,251,966.98 

2,826,144.35 

142,625.14 

404,814.72 


Fiscal  Year. 
1875 
1876 
1877 
1878 
1879 
1880 
1881 
1882 
1883 
1884 
1885 
1886 
1887 
1888 
1889 
1890 
1891 
1892 
1893 
1894 
1895 
1896 
1897 
1898 
1899 
1900 
1901 
1902 


Audited  Postal 
Surplus. 


1,253,923.57 
2,181.352.57 


Audited  Postal 
Deficit. 
$6,820,320.84 
4,647,253.04 
6,127,356.02 
4,905,029.28 
3,415,933.00 
3,221,953.48 
2,821,959.11 


3,907,057.29 
7,481,410.22 
7,068,495.10 
4,145,018.20 
3,772,466.03 
6,169,104.44 
5,400,764.44 
7,150,610.13 
6,110,975.97 
5,716,788.75 
9,977,515.32 

10,230,442.13 
8,444,201.31 

11,431,579.41 
9,054,551.75 
6,630,135.60 
5,410,358.10 
3,981,520.71 
2,961,169.91 


of  AodiUH'  for  tiw  Pott  Office   Dcpertnwnt  wu  created  by  act  of  Congren  approved  July  2,  1836. 

97 


Audited  Postal  Audited  Postal  Audited  Postal  Audited  Postal 

Fiscal  Year.                Surplus.                    Deficit.      Fiscal  Year.  Surplus.                    Deficit. 

1865  917,249.50  1903  4,586,977.16 

1866  933,851.10  1904  8,812,769.17 

1867  3,972,351.92  1905  14,594,387.12 

1868  ,  6,545,348.20  1906  10,542,941.76 

1869  6,363,737.20  1907  6,692,031.47 

1870  5,097,854.11  1908  16,910,278.99 

1871  4,358,752.21  1909  17,479,770.47 

1872  4,749,094.11  1910  5,881,481.95 

1873  6,128,892.84  1911  219,118.12  

1874  5,757,908.07  1912  1,785,523.10 

From  articles  in  the  North  American  Review,  June  and  July,  1902,  on  "Defects  and  Abuses  in 
Our  Postal  System,"  by  Henry  A.  Castle  (then  Auditor,  United  States  Post  Office  Department)  : 

All  public  men  and  patriotic  citizens  should  know  more  about  the  postal  service,  take  a  more 
lively  interest  in  it,  watch  its  development  carefully,  and  guard  its  integrity  with  jealous  zeal.  It  is  an 
exceedingly  vital  part  of  our  government  polity — all  the  more  vital  because  it  is,  strictly  speaking,  not 
a  public  function  at  all,  but  is  more  probably  a  private  or  corporate  enterprise  engrafted  on  the  gov- 
ernment's mechanism  under  pressure  of  an  imperious  necessity. 

All  the  avoidable  abuses  are  not  actually  existent.  Many  are  only  in  embryo,  but  with  well  ma- 
tured aspirations,  already  menacing.  The  irrepressible  enthusiast  who  disclaims  against  government 
by  injunction  is  loudest  in  advocating  further  innovations  that  would  soon  lead  to  government  in  the 
hands  of  a  receiver.  There  is  loud  and  influential  demand  for  the  postal  telegraph,  postal  savings 
bank,  and  a  postal  life  insurance  bureau.  There  are  wild,  vague  cries  for  the  absorption  of  all  rail- 
ways under  government  ownership  and  Post  Office  Department  management. 

It  may  be  true  that  the  government  could  send  out  telegrams  at  reduced  rates  and  pay  expenses ; 
but  little  compact  England  has  lost  $3,500,000  a  year  trying  to  do  it,  and  is  very  weary  of  the  experi- 
ment. 

******  ***!ti:|i 

The  fallacy  of  calling  our  postal  system  self-sustaining  even  if  on  the  face  of  the  books  and  on 
its  present  foundation  it  should  fail  to  show  a  deficit  at  the  close  of  some  fiscal  year,  does  not  occur  to 
casual  observers,  but  it  is  recognized  by  all  who  study  the  subject.  A  railway  company  doing  a  busi- 
ness of  nearly  $1,000,000,000  a  year,  which  was  required  to  pay  no  interest  on  bonds  or  dividends  on 
stock  would  be  a  financial  phenomenon.  It  is  conceivable  that  the  mail  service  might  be  so  managed 
by  a  corporation  as  to  yield  satisfactory  results  and  pay  a  small  dividend,  provided  it  performed  no 
gratuitous  services  for  the  government  as  a  condition  of  its  existence.  As  now  managed  the  Post 
Office  Department  has  no  "plant"  whatever.  All  it  owns  in  the  way  of  personal  property  is  mail  bags, 
mail  locks,  letter  boxes,  carrier's  bags  and  a  few  similar  inconsequential  items  of  equipment.  Even  in 
public  buildings  it  is  the  tenant  of  the  Treasury  Department. 

(Editorial) 

Chicago,  111.,  Journal,  December  22,  1913: 

Postmaster  General  Burleson  spoke  of  government  telegraphs  and  telephones  as  being  fore- 
shadowed by  the  parcel  post  and  postal  savings  bank.  The  reference  is  not  happy.  Only  last  week 
Mr.  Burleson  asked  for  an  immediate  emergency  appropriation  of  $1,000,000  to  run  the  parcel  post 
till  next  June.  No  one  knows  or  can  know  for  at  least  a  year  to  come  whether  the  parcel  post  will 
pay  its  own  way  or  not.  As  for  postal  savings  banks,  the  amount  on  deposit  in  these  institutions  on  the 
latest  date  for  which  figures  are  available  was  $35,392,622 — about  40  cents  per  capita  for  the  American 
people. 

98 


Washington,  D.  C,  Post,  December  20,  1913: 

Replying  to  the  objection  that  government  monopoly  in  Europe  has  proved  a  failure  financial- 
ly in  every  such  undertaking.  Postmaster  General  Burleson  remarks  that  our  [>ostal  service  is  self-sus- 
taining. But  if  we  ask  what  made  it  pay  expenses,  whether  by  means  of  its  own  activities  or  by  legis- 
lation which  gave  it  a  big  advantage  over  private  enterprise,  the  ground  is  cut  from  under  the 
argument.  An  act  of  Congress  sufficed  to  give  the  post  office  department  the  right  to  compete  with  the 
express  companies,  without  consulting  public  opinion.  But  when  it  comes  to  binding  the  government 
to  incur  the  enormous  expense  involved  in  the  purchase  of  telephones  and  telegraphs  and  depleting  all 
the  State  treasuries  of  their  income*  now  derived  from  taxes  and  franchises  assessed  against  the  com- 
panies owning  the  lines,  some  15,000,000  voters  may  be  on  their  feet  demanding  the  last  word  in  the 
transaction.  , 

Rochester,  N.  Y.,  Herald,  December  20,  1913: 

The  delivery  of  a  letter  is  a  comparatively  simple  undertaking.  It  may  be  trusted  to  men  of  no 
technical  mechanical  training  or  skill.  It  need  be  performed  with  only  a  moderate  degree  of  celerity. 
It  requires  a  comparatively  small  permanent  investment  in  plant.  It  is,  in  a  word,  a  simple  function 
whose  processes  are  easily  understood  by  both  the  servant  and  the  served ;  yet  with  all  these  elements 
contributing  to  the  efficiency  and  ease  of  performance,  there  is  continual  complaint  that  the  mail  ser- 
vice does  not  satisfy  expectations  or  needs.  *  *  *  This  being  true  of  the  mail,  how  much  more  true 
would  it  be  of  the  vastly  more  difficult  and  more  urgent  service  of  the  telephone  and  telegraph  under 
Government  operation. 

Boston  News  Bureau,  December  20,  1913: 

Now  the  notable  circumstance  is  that  so  far  no  good  reason  is  given  why  Uncle  Sam  should 
tackle  the  new  job.  Waiving  contention  as  to  legal  power — which  Mr.  Mackay  does  contest — the  only 
definite  reason  advanced  by  the  Postmaster  is  that  success  in  parcel  post  administration  demonstrates 
federal  capacity  to  run  telephone  and  telegraph,  since  these  also  are  means  of  communication,  and  their 
scope  is  so  big  that  federal  "unselfishness"  is  needed.  Here  is  the  fallacy  of  the  undisturbed  middle,  as 
r^ards  "means  of  communication,"  embracing  letter,  parcel,  tel^ram,  and  telephone  call  as  being  iden- 
tical in  substance  and  treatment.  As  well  say  that  canoe  and  dreadnought  make  equal  demands  on 
builder  and  user.    Here  is  ignored  the  fundamental  distinction  of  character. 

The  other  difference  of  character  as  between  federal  conduct  and  private  conduct  of  large  en- 
terprises should  by  now  have  impessed  itself  on  the  citizens'  consciousness.  Governmental  costs 
average  close  to  50  per  cent,  above  those  of  competing  private  enterprise  wherever  comparison  is  pos- 
sible. The  Aldrich  assertion  as  to  $300,000,000  annual  waste  has  since  been  little  curtailed  by  efficiency 
commissions;  the  testimony  of  the  Burleson  and  Lewis  proposals  would  be  to  multiply  it. 

New  York  Press,  December  19,  1913: 

Mr.  Don  C.  Seitz,  a  well  trained  and  very  successful  manager  of  a  large  publishing  concern,  gave 
G)ngress  a  flat  challenge  only  a  few  months  ago.  If  Congress  and  the  rest  of  the  Government  would 
confer  upon  him  the  necessary  license,  he  offered,  within  a  few  days  to  form  a  syndicate  to  take  over 
and  operate,  as  a  private  enterprise,  the  whole  post  office  system,  under  Government  regulation  and  to 
give  a  vastly  and  more  frequent  (sic)  postal  service  than  is  now  given  by  the  Government,  and  to  lower 
postage  rates  for  all  classes  of  business,  except,  of  course,  the  oceans  and  oceans  of  Congress'  own 
"dead  head"  stuflF. 

New  York  IVorld,  December  19,  1913: 

The  World  has  extensive  business  relations  with  the  post  office  department.  It  is  one  of  the 
principal  patrons  of  the  telegraph  companies  and  the  telephone  company.  We  can  assure  Mr.  Burleson 
that  if  the  telegraph  and  telephone  service  that  we  pay  for  was  as  incompetent  and  unsatisfactory  as 
the  postal  service  that  we  pay  for,  it  would  be  very  difficult  indeed  to  print  a  great  newspaper.  We  can 

99 


further  assure  him  that  it  will  be  a  sorry  day  for  this  country  if  intelligent  American  sentiment  ever 
countenances  the  placing  of  all  revenues  and  channels  of  written  and  spoken  communications  under 
the  autocratic  control  of  a  partisan,  political,  post  office  department. 

Buffalo,  N.  Y.,  Evening  News,  December  19,  1913: 

It  is  only  within  the  last  year  or  so,  or  since  the  directorship  of  Postmaster-General  Hitchcock 
that  the  government  showed  even  a  penny  of  profit.  That  is  done  by  taking  off  a  great  mass  of 
service  that  costs  a  great  deal  and  yet  is  not  charged  as  it  should  be,  but  it  is  due  also  to  a  miserable 
service  in  many  places. 

Buffalo  has  suffered  not  a  little  in  that  respect.  Complaints  have  gone  to  Washington  for  a 
score  of  years  without  improvement  to  speak  of.  In  fact,  there  have  been  years  not  very  far  behind 
us  when  citizens  ceased  complaining  because  it  was  hopeless.  This  does  not  imply  fault  in  the  local 
managers,  but  fault  in  the  general  policy  of  the  department  about  equipment  and  facilities  for  han- 
dling the  mails  in  the  best  way. 

Mr.  Burleson's  suggestion  that  the  government  spend  several  hundreds  of  millions  in  acquiring 
the  wire  service  of  the  country  and  take  on  its  payroll  some  hundreds  of  thousands  of  operatives, 
comes  at  a  time  when  the  Postmaster-General  in  Great  Britain,  where  the  telegraph  service  is  a  public 
monopoly,  is  compelled  to  go  to  Parliament  for  an  enormous  subsidy  in  order  to  put  his  department 
on  a  living  basis.  It  has  become  so  run  down  under  the  endeavor  to  operate  it  so  as  to  make  a  better 
showing  than  when  it  was  in  private  hands. 

Syracuse,  N.  Y.,  Journal,  December  19,  1913 : 

The  people  of  Syracuse  don't  want  an  agitation  of  the  purchase  of  any  other  "transportation 
adjunct"  to  the  postal  service  until  the  efficiency  of  the  postal  service  has  been  raised ;  and  they  but 
echo  the  voice  of  protest  of  the  entire  country  because  the  inequalities  and  inefficiencies  in  the  service 
in  this   city  are   probably   duplicated   in   every   city  in  the  United  States. 

Troy,  N.  Y.,  Record,  December  19,  1913: 

The  plan  of  Postmaster-General  Burleson  for  government  ownership  of  the  telegraph  and  tele- 
phone lines  would  receive  more  attention  from  the  people  if  he  first  would  perfect  the  government 
postal  system.  The  room  for  improvement  in  that  service  is  so  great  that  he  can  find  plenty  of  room 
for  active  and  effective  work  without  having  the  national  wire  lines  added  to  his  burdens.  Besides,  the 
people  just  now  are  not  in  a  mood  to  have  the  telegraph  and  telephone  offices  organized  as  are  those 
of  the  postal  department,  with  non-working  heads  drawing  large  salaries  merely  for  political  reasons. 

Springfield,  Mass.,  Morning  Union,  December  19,  1913: 

Meanwhile  the  difference  between  conducting  a  postal  service  over  privately  owned  railroads 
and  by  means  of  privately  owned  cars  and  the  purchase  outright  and  operation,  independently,  of  pri- 
vate interest,  of  the  telephone  and  telegraph  systems,  is  clearly  apparent.  Mr.  Burleson  says  that 
other  principal  countries  have  government  owned  telegraph  and  telephone  systems,  but  he  neglected  to 
state  that  not  one  of  those  countries  has  a  system  that  approaches  in  efficiency  the  American  systems. 

Newburgh,  N.  Y.,  Journal,  December  18,  1913: 

Assuming  that  Mr.  Burleson's  figures  are  correct,  however,  the  dividend  which  the  post  office 
department  is  alleged  to  have  declared,  the  first,  it  is  admitted,  since  1883,  would  be  regarded  as  a 
pretty  poor  demonstration  of  capacity  in  the  business  world.  As  for  the  parcel  post,  it  is  still  an  ex- 
periment and  while  it  is  a  good  institution  and  one  that  is  appreciated  and  patronized  by  the  public, 
the  question  arises  whether  or  not  it  would  be  so  amazingly  profitable  if  the  Government  were  com- 
pelled to  pay  the  railroad  what  it  is  worth  to  carry  parcels.  ' 

New  York  World,  December  18,  1913 : 

Has  the  Government  sufficiently  proved  its    mastery   even   of   railroad    regulation,    let   alone 

100 


ownership  and  operation,  to  warrant  its  venture  into  these  new  fields  ?  When  it  has  done  so  and  when 
it  can  offer  an  economical  postal  service  which  will  attract  and  not  drive  away  business,  there  will 
be  time  enough  to  talk  about  piling  on  to  it  other  businesses. 

Attleboro,  Mass.,  Sun,  December  16,  1913: 

Experience  in  the  navy  yards  where  the  Government  pays  $2,000,000  more  for  a  war  ship  than 

a  private  contractor  charges,  has  been  as  illuminating  as  the  conditions  in  the  Government  printing 

office  where  type  is  still  set  by  hand  because  fewer  would  be  employed  and  at  less  expense  if  there 

were  used  the  typesetting  machines  which  even  the  smallest  private  office  owns.    By  charging  off  rent 

and  building  expenses  to  the  Treasury  Department,  the  post  office  apparently  pays  expenses  and  the 

parcel  post  has  not  yet  existed  long  enough  for  a  financial  test. 

I 

New  York  Times,  December  12,  1913: 

"Mr.  Burleson's  comparison  with  the  parcel  post  is  also  an  absurdity,"  said  a  high  authority  in 
the  telephone  business.  "To  make  the  existing  postal  system  available  for  package  business,  the  de- 
partment has  only  to  add  a  clerk  here  and  there  and  fix  rates.  The  organization  was  ready.  As  for 
the  fact  that  foreign  Governments  operate  the  wire  systems,  it  should  be  remembered  that  the  older 
nations  were  monarchies,  with  all  powers  in  the  hands  of  the  ruler.  They  have  gradually  been  work- 
ing down  to  democracy.  Here  we  started  as  a  democracy  with  property  and  rights  in  the  hands  of 
the  individuals,  and  it  is  proposed  to  vest  these  rights  in  the  central  government.  Money  cannot  buy 
an  organization,  nor  the  brains  that  have  created  it.  It  is  a  thing  of  very  slow  growth,  which  can  be 
killed  over  night. 

Philadelphia,  Pa.,  Public  Ledger,  October  3,  1913: 

The  Post  Office  Department  has  been  managed  with  far  less  efficiency  and  economy  than  any  of 
the  great  industrial  companies  or  the  railroads.  Political  expediency  rather  than  a  good  service  has 
for  many  years  been  the  policy  in  that  Government-owned  institution. 

Toledo,  Ohio,  Blade,  October  7,  1913 : 

Before  we  have  Government-run  telegraph  offices  and  Government-owned  telephones,  let  us 
feel  certain  that  the  Government  can  do  it  without  having  to  ask  Congress  to  make  up  its  losses  on 
telegraph  and  telephone  service  as  it  has  to  ask  it  to  cover  the  losses  on  the  handling  and  delivery  of 
the  mails. 

New  York  Press,  October  4,  1913: 

The  Government  already  had  all  the  necessary  machinery  in  existence  and  in  operation,  for  the 
continuance  of  the  postal  business.  It  had  the  offices,  it  had  the  expert  managers  and  superintendents, 
it  had  the  trained  men,  it  had  the  established  routes  by  railroad,  water,  horse  and  land.  It  already 
had  virtually  everything  that  was  essential  to  the  success  of  the  postal  business.  It  had  it  working  out 
under  the  test  of  long  experience.  All  it  had  to  do,  in  fact,  was  to  chuck  the  parcel  post  system  into 
the  post  office  system  and  let  it  go  at  that. 

But  it  hasn't  any  telegraph  service.  Outside  of  military  specialists  it  hasn't  any  expert  that 
knows  the  fine  points  about  the  telegraph  service.  It  hasn't  any  facilities  for  conducting  the  tele- 
graph business.  Unless  it  took  over  the  whole  telegraph  business  as  it  stands  with  all  the  persons  now 
engaged  in  the  telegraph  business  to  help  out  the  Government,  it  couldn't  operate  in  that  field  the  way 
it  operated  in  the  parcel  post  field. 

From  article  entitled,  "The  Abuse  of  the  Congressional  Frank,"  by  Robert  D.  Heinl,  published 
in  Leslie's  Weekly  (New  York),  January  30,  1913: 

A  member  of  Congress  who  is  a  candidate  for  re-election  can  have  his  political  documents 
printed  in  the  Congressional  Record,  and  then  as  has  been  explained  he  can  send  them  through  the 
maib  free  of  charge.    He  has  to  pay  the  actual  cost  of  printing  of  the  documents,  but  the  envelopes 

101 


for  mailing  them  with  the  congressional  frank  appropriately  stamped  on  them,  are  furnished  free, 
at  public  expense.  However,  since  he  does  not  have  to  pay  any  postage,  which  is  by  far  the  largest 
item,  he  reaches  the  voter  with  comparatively  little  expense  to  himself.  The  candidate  who  is  op- 
posing the  man  in  office  must  pay  full  postage  on  all  matter  that  he  sends  through  the  mails. 

Washington,  D.  C,  Post,  December  11,  1913: 

The  one  example  of  Government  monopoly — the  post  office  department — to  which  the  pro- 
moters of  the  scheme  can  point  with  pride,  was  created  to  fill  a  want  in  a  field  that  private  enterprise 
had  not  gone  into,  a  condition  of  affairs  and  the  only  condition,  that  gives  warrant  and  consent  to 
Government  ownership  of  utilities. 


102 


i 


UNIVERSITY  OF  CALIFORNIA  LIBRARY 
This  book  is  DUE  on  the  last  date  stamped  below. 


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